CREDIT AGREEMENT
among
DOMINICK'S SUPERMARKETS, INC.,
DOMINICK'S FINER FOODS, INC.,
VARIOUS BANKS,
BANKERS TRUST COMPANY,
as ADMINISTRATIVE AGENT,
THE CHASE MANHATTAN BANK,
as SYNDICATION AGENT,
and
BANKERS TRUST COMPANY
and
CHASE SECURITIES INC.,
as CO-ARRANGERS
__________________________________
Dated as of October 28, 1997
__________________________________
TABLE OF CONTENTS
Page
SECTION 1. Amount and Terms of Credit 1
1.01 The Commitments 1
1.02 Minimum Amount of Each Borrowing 3
1.03 Notice of Borrowing 3
1.04 Disbursement of Funds 5
1.05 Notes 5
1.06 Conversions 6
1.07 Pro Rata Borrowings 7
1.08 Interest 7
1.09 Interest Periods 8
1.10 Increased Costs, Illegality, etc. 9
1.11 Compensation 11
1.12 Change of Lending Office 12
1.13 Replacement of Banks 12
SECTION 2. Letters of Credit 13
2.01 Letters of Credit 13
2.02 Maximum Letter of Credit Outstandings; Final 14
Maturities
2.03 Letter of Credit Requests; Minimum Stated Amount 15
2.04 Letter of Credit Participations 15
2.05 Agreement to Repay Letter of Credit Drawings 18
2.06 Increased Costs 19
SECTION 3. Commitment Commission; Fees; Reductions of 20
Commitment
3.01 Fees 20
3.02 Voluntary Termination of Unutilized Commitments 21
3.03 Mandatory Reduction of Commitments 21
SECTION 4. Prepayments; Payments; Taxes 23
4.01 Voluntary Prepayments 23
4.02 Mandatory Repayments 24
4.03 Method and Place of Payment 25
4.04 Net Payments 26
SECTION 5. Conditions Precedent to the Effective Date 28
5.01 Execution of Agreement; Notes 28
5.02 Officers' Certificate 28
5.03 Opinions of Counsel 28
5.04 Corporate Documents; Proceedings; etc. 28
5.05 Shareholders' Agreements; Management Agreements; 29
Tax Sharing Agreements
5.06 Senior Subordinated Note Tender Offer; Senior 29
Subordinated Note Consents; Senior Subordinated
Note Indenture Supplement
5.07 Bank Refinancing 30
5.08 Synthetic Lease Amendment 30
5.09 Adverse Change, etc. 31
5.10 Litigation 31
5.11 Pledge Agreements 31
5.12 Security Agreement 32
5.13 Trademark Security Agreement 33
5.14 Collateral Account Agreement 33
5.15 Subsidiaries Guaranty 33
5.16 Mortgages; Title Insurance; etc 33
5.17 SL Credit Documents 35
5.18 Intercreditor Agreement 35
5.19 Financial Statements; Pro Forma Balance Sheet; 35
Projections
5.20 Solvency Certificate; Insurance Certificates 35
5.21 Fees, etc. 35
SECTION 6. Conditions Precedent to All Credit Events 35
6.01 Effective Date 36
6.02 No Default; Representations and Warranties 36
6.03 Notice of Borrowing; Letter of Credit Request 36
SECTION 7. Representations, Warranties and Agreements 36
7.01 Corporate Status 37
7.02 Corporate and Other Power and Authority 37
7.03 No Violation 37
7.04 Approvals 38
7.05 Financial Statements; Financial Condition; 38
Undisclosed Liabilities; Projections; etc.
7.06 Litigation 40
7.07 True and Complete Disclosure 40
7.08 Use of Proceeds; Margin Regulations 40
7.09 Tax Returns and Payments 40
7.10 Compliance with ERISA 41
7.11 The Security Documents 42
7.12 Properties 43
7.13 Representations and Warranties in the Documents 43
7.14 Patents, Licenses, Franchises and Formulas 43
7.15 Subsidiaries 44
7.16 Compliance with Statutes, etc. 44
7.17 Investment Company Act 44
7.18 Public Utility Holding Company Act 44
7.19 Environmental Matters 44
7.20 Labor Relations 45
7.21 Indebtedness 45
SECTION 8. Affirmative Covenants 46
8.01 Information Covenants 46
(a) Quarterly Financial Statements 46
(b) Annual Financial Statements 47
(c) Management Letters 48
(d) Budgets. 48
(e) Officer's Certificates 48
(f) Notice of Default or Litigation 48
(g) Other Reports and Filings 49
(h) Environmental Matters 49
(i) Annual Meetings with Banks 50
(j) SL Documents 50
(k) Board of Directors 50
(l) Other Information 50
8.02 Books, Records and Inspections 50
8.03 Maintenance of Property; Insurance 51
8.04 Corporate Franchises 51
8.05 Compliance with Statutes, etc. 51
8.06 Compliance with Environmental Laws 52
8.07 ERISA 53
8.08 End of Fiscal Years; Fiscal Quarters 54
8.09 Performance of Obligations 54
8.10 Payment of Taxes 54
8.11 Margin Stock 54
8.12 Execution of Subsidiaries Guaranty and Security 55
Documents by Future Subsidiaries
8.13 Additional Real Property 56
8.14 Designation of Replacement Properties 58
8.15 Release of Collateral 59
8.16 Further Assurances 60
8.17 Maintenance of Corporate Separateness 60
SECTION 9. Negative Covenants 61
9.01 Liens 61
9.02 Consolidation, Merger, Purchase or Sale of 65
Assets, etc.
9.03 Dividends 67
9.04 Indebtedness 69
9.05 Advances, Investments and Loans 72
9.06 Transactions with Affiliates 74
9.07 Capital Expenditures 75
9.08 Minimum Fixed Charge Coverage Ratio 77
9.09 Maximum Leverage Ratio 78
9.10 Minimum Consolidated Net Worth 79
9.11 Limitation on Voluntary Payments and 80
Modifications of Certain Indebtedness; Limitation
on Modifications of Certificate of Incorporation,
By-Laws and Certain Other Agreements.
9.12 Limitation on Certain Restrictions on Sub- 81
sidiaries
9.13 Limitation on Issuance of Capital Stock 82
9.14 Business 82
SECTION 10. Events of Default 83
10.01 Payments 83
10.02 Representations, etc. 83
10.03 Covenants 83
10.04 Default Under Other Agreements 83
10.05 Bankruptcy, etc. 84
10.06 ERISA 84
10.07 Security Documents. 85
10.08 Guaranty 85
10.09 Judgments 85
10.10 Default Under or Relating To SL Documents or SL 86
Lessor Guaranty
10.11 Change of Control 86
SECTION 11. Definitions and Accounting Terms 87
11.01 Defined Terms 87
SECTION 12. The Agents 118
12.01 Appointment 118
12.02 Nature of Duties 119
12.03 Lack of Reliance on the Agents 119
12.04 Certain Rights of the Agents 119
12.05 Reliance 120
12.06 Indemnification 120
12.07 The Agents in Their Individual Capacities 120
12.08 Holders 121
12.09 Resignation by the Agents 121
SECTION 13. Miscellaneous 122
13.01 Payment of Expenses, etc. 122
13.02 Right of Setoff 123
13.03 Notices 123
13.04 Benefit of Agreement; Assignments; Participa- 124
tions
13.05 No Waiver; Remedies Cumulative 126
13.06 Payments Pro Rata 126
13.07 Calculations; Computations; Accounting Terms 127
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; 127
VENUE; WAIVER OF JURY TRIAL
13.09 Counterparts 128
13.10 Effectiveness 129
13.11 Headings Descriptive 129
13.12 Amendment or Waiver; etc. 129
13.13 Survival 131
13.14 Domicile of Loans 131
13.15 Register 131
13.16 Confidentiality 132
13.17 Limitation on Additional Amounts, Etc. 132
SECTION 14. Holdings Guaranty 133
14.01 Guaranty 133
14.02 Bankruptcy 133
14.03 Nature of Liability 134
14.04 Independent Obligation 134
14.05 Authorization 134
14.06 Reliance 135
14.07 Subordination 135
14.08 Waiver 136
14.09 Nature of Liability 137
SCHEDULE I Commitments
SCHEDULE II Bank Addresses
SCHEDULE IIIReal Property
SCHEDULE IV Subsidiaries
SCHEDULE V Existing Indebtedness
SCHEDULE VI Existing Liens
SCHEDULE VIIProjections
SCHEDULE VIII Existing Investments
SCHEDULE IX Existing Letters of Credit
SCHEDULE X Litigation
SCHEDULE XI Properties to be Sold
EXHIBIT A Notice of Borrowing
EXHIBIT B-1 Revolving Note
EXHIBIT B-2 Swingline Note
EXHIBIT C Letter of Credit Request
EXHIBIT D Section 4.04(b)(ii) Certificate
EXHIBIT E-1 Opinion of Xxxxxx & Xxxxxxx,
Special Counsel to the Credit Parties
EXHIBIT E-2 Opinion of the Corporate Counsel of
the Borrower
EXHIBIT F Officers' Certificate
EXHIBIT G-1 Holdings Pledge Agreement
EXHIBIT G-2 Borrower Pledge Agreement
EXHIBIT G-3 Subsidiary Pledge Agreement
EXHIBIT H-1 Holdings Security Agreement
EXHIBIT H-2 Borrower Security Agreement
EXHIBIT H-3 Subsidiary Security Agreement
EXHIBIT I-1 Borrower Trademark Security Agreement
EXHIBIT I-2 Subsidiary Trademark Security Agreement
EXHIBIT J Collateral Account Agreement
EXHIBIT K Subsidiaries Guaranty
EXHIBIT L XX Xxxxxx Guaranty
EXHIBIT M Intercreditor Agreement
EXHIBIT N Solvency Certificate
EXHIBIT O Assignment and Assumption Agreement
EXHIBIT P Intercompany Note
CREDIT AGREEMENT, dated as of October 28, 1997, among
DOMINICK'S SUPERMARKETS, INC., a Delaware corporation ("Holdings"),
DOMINICK'S FINER FOODS, INC., a Delaware corporation (the
"Borrower"), the Banks party hereto from time to time, THE CHASE
MANHATTAN BANK, as Syndication Agent, BANKERS TRUST COMPANY, as
Administrative Agent, and BANKERS TRUST COMPANY and CHASE SECURITIES
INC., as Co-Arrangers (all capitalized terms used herein and defined
in Section 11 are used herein as therein defined).
W I T N E S S E T H :
WHEREAS, subject to and upon the terms and conditions set
forth herein, the Banks are willing to make available to the Borrower
the respective credit facilities provided for herein;
NOW, THEREFORE, IT IS AGREED:
SECTION 1. Amount and Terms of Credit.
1.01 The Commitments. (a) Subject to and upon the terms
and conditions set forth herein, each Bank severally agrees to make,
at any time and from time to time on and after the Effective Date and
prior to the Final Maturity Date, a revolving loan or revolving loans
(each a "Revolving Loan" and, collectively, the "Revolving Loans") to
the Borrower, which Revolving Loans (i) shall, at the option of the
Borrower, be incurred and maintained as, and/or converted into, Base
Rate Loans or Eurodollar Loans, provided that, except as otherwise
specifically provided in Section 1.10(b), all Revolving Loans
comprising the same Borrowing shall at all times be of the same Type,
(ii) may be repaid and reborrowed in accordance with the provisions
hereof, (iii) shall not exceed for any Bank at any time outstanding
that aggregate principal amount which, when added to the product of
(x) such Bank's RL Percentage and (y) the sum of (I) the aggregate
amount of all Letter of Credit Outstandings (exclusive of Unpaid
Drawings which are repaid with the proceeds of, and simultaneously
with the incurrence of, the respective incurrence of Revolving Loans)
at such time and (II) the aggregate principal amount of all Swingline
Loans (exclusive of Swingline Loans which are repaid with the pro-
ceeds of, and simultaneously with the incurrence of, the respective
incurrence of Revolving Loans) then outstanding, equals the Revolving
Loan Commitment of such Bank at such time and (iv) shall not exceed
for all Banks at any time outstanding that aggregate principal amount
which, when added to the sum of (I) the aggregate amount of all
Letter of Credit Outstandings (exclusive of Unpaid Drawings which are
repaid with the proceeds of, and simultaneously with the incurrence
of, the respective incurrence of Revolving Loans) at such time and
(II) the aggregate principal amount of all Swingline Loans (exclusive
of Swingline Loans which are repaid with the proceeds of, and
simultaneously with the incurrence of, the respective incurrence of
Revolving Loans) then outstanding, equals the Total Revolving Loan
Commitment at such time.
(b) Subject to and upon the terms and conditions set forth
herein, the Swingline Bank agrees to make, at any time and from time
to time on and after the Effective Date and prior to the Swingline
Expiry Date, a revolving loan or revolving loans (each a "Swingline
Loan" and, collectively, the "Swingline Loans") to the Borrower,
which Swingline Loans (i) shall be made and maintained as Base Rate
Loans, (ii) may be repaid and reborrowed in accordance with the
provisions hereof, (iii) shall not exceed in aggregate principal
amount at any time outstanding, when combined with the sum of (I) the
aggregate principal amount of all Revolving Loans then outstanding
and (II) the aggregate amount of all Letter of Credit Outstandings at
such time, an amount equal to the Total Revolving Loan Commitment at
such time, and (iv) shall not exceed in aggregate principal amount at
any time outstanding the Maximum Swingline Amount. Notwithstanding
anything to the contrary contained in this Section 1.01(b), (x) the
Swingline Bank shall not be obligated to make any Swingline Loans at
a time when a Bank Default exists unless the Swingline Bank has
entered into arrangements satisfactory to it and the Borrower to
eliminate the Swingline Bank's risk with respect to the Defaulting
Bank's or Banks' participation in such Swingline Loans, including by
cash collateralizing such Defaulting Bank's or Banks' RL Percentage
of the outstanding Swingline Loans and (y) the Swingline Bank shall
not make any Swingline Loan after it has received written notice from
the Borrower or the Required Banks stating that a Default or an Event
of Default exists and is continuing until such time as the Swingline
Bank shall have received written notice (I) of rescission of all such
notices from the party or parties originally delivering such notice
or (II) of the waiver of such Default or Event of Default by the
Required Banks.
(c) On any Business Day, the Swingline Bank may, in its
sole discretion, give notice to the Banks that the Swingline Bank's
outstanding Swingline Loans shall be funded with one or more
Borrowings of Revolving Loans (provided that such notice shall be
deemed to have been automatically given upon the occurrence of a
Default or an Event of Default under Section 10.05 or upon the
exercise of any of the remedies provided in the last paragraph of
Section 10), in which case one or more Borrowings of Revolving Loans
constituting Base Rate Loans (each such Borrowing, a "Mandatory
Borrowing") shall be made on the immediately succeeding Business Day
by all Banks pro rata based on each Bank's RL Percentage (determined
before giving effect to any termination of the Revolving Loan
Commitments pursuant to the last paragraph of Section 10) and the
proceeds thereof shall be applied directly by the Swingline Bank to
repay the Swingline Bank for such outstanding Swingline Loans. Each
Bank hereby irrevocably agrees to make Revolving Loans upon one
Business Day's notice pursuant to each Mandatory Borrowing in the
amount and in the manner specified in the preceding sentence and on
the date specified in writing by the Swingline Bank notwithstanding
(i) the amount of the Mandatory Borrowing may not comply with the
Minimum Borrowing Amount otherwise required hereunder, (ii) whether
any conditions specified in Section 6 are then satisfied, (iii)
whether a Default or an Event of Default then exists, (iv) the date
of such Mandatory Borrowing and (v) the amount of the Total Revolving
Loan Commitment at such time. In the event that any Mandatory
Borrowing cannot for any reason be made on the date otherwise
required above (including, without limitation, as a result of the
commencement of a proceeding under the Bankruptcy Code with respect
to the Borrower), then each Bank hereby agrees that it shall forth-
with purchase (as of the date the Mandatory Borrowing would otherwise
have occurred, but adjusted for any payments received from the
Borrower on or after such date and prior to such purchase) from the
Swingline Bank such participations in the outstanding Swingline Loans
as shall be necessary to cause the Banks to share in such Swingline
Loans ratably based upon their respective RL Percentages (determined
before giving effect to any termination of the Revolving Loan
Commitments pursuant to the last paragraph of Section 10), provided
that (x) all interest payable on the Swingline Loans shall be for the
account of the Swingline Bank until the date as of which the
respective participation is required to be purchased and, to the
extent attributable to the purchased participation, shall be payable
to the participant from and after such date and (y) at the time any
purchase of participations pursuant to this sentence is actually
made, the purchasing Bank shall be required to pay the Swingline Bank
interest on the principal amount of participation purchased for each
day from and including the day upon which the Mandatory Borrowing
would otherwise have occurred to but excluding the date of payment
for such participation, at the overnight Federal Funds Rate for the
first three days and at the rate otherwise applicable to Revolving
Loans maintained as Base Rate Loans hereunder for each day
thereafter.
1.02 Minimum Amount of Each Borrowing. The aggregate
principal amount of each Borrowing of Revolving Loans or Swingline
Loans shall not be less than the Minimum Borrowing Amount applicable
thereto. More than one Borrowing may occur on the same date, but at
no time shall there be outstanding more than twenty Borrowings of
Eurodollar Loans.
1.03 Notice of Borrowing. (a) Whenever the Borrower xx-
xxxxx to incur (x) Eurodollar Loans hereunder, the Borrower shall
give the Administrative Agent at the Notice Office at least three
Business Days' prior notice of each Eurodollar Loan to be incurred
hereunder and (y) Base Rate Loans hereunder (excluding Swingline
Loans and Revolving Loans made pursuant to a Mandatory Borrowing),
the Borrower shall give the Administrative Agent at the Notice Office
at least one Business Day's prior notice of each Base Rate Loan to be
incurred hereunder, provided that (in each case) any such notice
shall be deemed to have been given on a certain day only if given
before 12:00 Noon (New York time) on such day. Each such notice
(each a "Notice of Borrowing"), except as otherwise expressly pro-
vided in Section 1.10, shall be irrevocable and shall be given by the
Borrower in writing, or by telephone promptly confirmed in writing,
in the form of Exhibit A, appropriately completed to specify the
aggregate principal amount of the Revolving Loans to be incurred
pursuant to such Borrowing, the date of such Borrowing (which shall
be a Business Day), whether the Revolving Loans being incurred pur-
suant to such Borrowing are to be initially maintained as Base Rate
Loans or, to the extent permitted hereunder, Eurodollar Loans and, if
Eurodollar Loans, the initial Interest Period to be applicable
thereto. The Administrative Agent shall promptly give each Bank
notice of such proposed Borrowing, of such Bank's proportionate share
thereof and of the other matters required by the immediately
preceding sentence to be specified in the Notice of Borrowing.
(b)(i) Whenever the Borrower desires to incur Swingline
Loans hereunder, the Borrower shall give the Swingline Bank no later
than 2:00 P.M. (New York time) on the date that a Swingline Loan is
to be incurred hereunder, written notice or telephonic notice
promptly confirmed in writing of each Swingline Loan to be incurred
hereunder. Each such notice shall be irrevocable and specify in each
case (A) the date of Borrowing (which shall be a Business Day) and
(B) the aggregate principal amount of the Swingline Loans to be
incurred pursuant to such Borrowing.
(ii) Mandatory Borrowings shall be made upon the notice
specified in Section 1.01(c), with the Borrower irrevocably agreeing,
by its incurrence of any Swingline Loan, to the making of the
Mandatory Borrowings as set forth in Section 1.01(c).
(c) Without in any way limiting the obligation of the
Borrower to confirm in writing any telephonic notice of any Borrowing
or prepayment of Loans, the Administrative Agent or the Swingline
Bank, as the case may be, may act without liability upon the basis of
telephonic notice of such Borrowing or prepayment, as the case may
be, believed by the Administrative Agent or the Swingline Bank, as
the case may be, in good faith to be from the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Financial
Officer, the Treasurer or any Assistant Treasurer of the Borrower, or
from any other authorized officer of the Borrower designated in
writing by any of the foregoing officers of the Borrower to the
Administrative Agent as being authorized to give such notices, prior
to receipt of written confirmation. In each such case, the Borrower
hereby waives the right to dispute the Administrative Agent's or
Swingline Bank's record of the terms of such telephonic notice of
such Borrowing or prepayment of Loans, as the case may be, absent
manifest error.
1.04 Disbursement of Funds. No later than 12:00 Noon
(New York time) on the date specified in each Notice of Borrowing
(or (x) in the case of Swingline Loans, no later than 3:00 P.M. (New
York time) on the date specified pursuant to Section 1.03(b)(i) or
(y) in the case of Mandatory Borrowings, no later than 1:00 P.M. (New
York time) on the date specified in Section 1.01(c)), each Bank will
make available its pro rata portion (determined in accordance with
Section 1.07) of each such Borrowing requested to be made on such
date (or in the case of Swingline Loans, the Swingline Bank will make
available the full amount thereof). All such amounts will be made
available in Dollars and in immediately available funds at the Pay-
ment Office, and, except for Revolving Loans made pursuant to Section
2.05(a) or pursuant to a Mandatory Borrowing, the Administrative
Agent will promptly make available to the Borrower at the Payment
Office the aggregate of the amounts so made available by the Banks.
Unless the Administrative Agent shall have been notified by any Bank
prior to the date of Borrowing that such Bank does not intend to make
available to the Administrative Agent such Bank's portion of any
Borrowing to be made on such date, the Administrative Agent may
assume that such Bank has made such amount available to the
Administrative Agent on such date of Borrowing and the Administrative
Agent may (but shall not be obligated to), in reliance upon such
assumption, make available to the Borrower a corresponding amount.
If such corresponding amount is not in fact made available to the
Administrative Agent by such Bank, the Administrative Agent shall be
entitled to recover such corresponding amount on demand from such
Bank. If such Bank does not pay such corresponding amount forthwith
upon the Administrative Agent's demand therefor, the Administrative
Agent shall promptly notify the Borrower and the Borrower shall
immediately pay such corresponding amount to the Administrative
Agent. The Administrative Agent also shall be entitled to recover on
demand from such Bank or the Borrower, as the case may be, interest
on such corresponding amount in respect of each day from the date
such corresponding amount was made available by the Administrative
Agent to the Borrower until the date such corresponding amount is
recovered by the Administrative Agent, at a rate per annum equal to
(i) if recovered from such Bank, at the overnight Federal Funds Rate
and (ii) if recovered from the Borrower, the rate of interest appli-
cable to the respective Borrowing, as determined pursuant to Section
1.08. Nothing in this Section 1.04 or in Section 2.05(a) shall be
deemed to relieve any Bank from its obligation to make Loans here-
under or to prejudice any rights which the Borrower may have against
any Bank as a result of any failure by such Bank to make Loans here-
under.
1.05 Notes. (a) The Borrower's obligation to pay the
principal of, and interest on, the Loans made by each Bank shall be
set forth in the Register maintained by the Administrative Agent
pursuant to Section 13.15 and shall, if requested by any Bank, also
be evidenced (i) if Revolving Loans, by a promissory note duly
executed and delivered by the Borrower substantially in the form of
Exhibit B-1, with blanks appropriately completed in conformity here-
with (each a "Revolving Note" and, collectively, the "Revolving
Notes") and (ii) if Swingline Loans, by a promissory note duly
executed and delivered by the Borrower substantially in the form of
Exhibit B-2, with blanks appropriately completed in conformity here-
with (the "Swingline Note").
(b) The Revolving Note issued to each Bank shall (i) be
executed by the Borrower, (ii) be payable to such Bank or its
registered assigns and be dated the Effective Date (or, if issued
after the Effective Date, be dated the date of the issuance thereof),
(iii) be in a stated principal amount equal to the Revolving Loan
Commitment of such Bank (or, if issued after the termination thereof,
be in a stated principal amount equal to the outstanding Revolving
Loans of such Bank at such time) and be payable in the outstanding
principal amount of the Revolving Loans evidenced thereby, (iv)
mature on the Final Maturity Date, (v) bear interest as provided in
the appropriate clause of Section 1.08 in respect of the Base Rate
Loans and Eurodollar Loans, as the case may be, evidenced thereby,
(vi) be subject to voluntary prepayment as provided in Section 4.01,
and mandatory repayment as provided in Section 4.02, and (vii) be
entitled to the benefits of this Agreement and the other Credit
Documents.
(c) The Swingline Note issued to the Swingline Bank shall
(i) be executed by the Borrower, (ii) be payable to the Swingline
Bank or its registered assigns and be dated the Effective Date, (iii)
be in a stated principal amount equal to the Maximum Swingline Amount
and be payable in the outstanding principal amount of the Swingline
Loans evidenced thereby from time to time, (iv) mature on the
Swingline Expiry Date, (v) bear interest as provided in the appro-
priate clause of Section 1.08 in respect of the Base Rate Loans
evidenced thereby, (vi) be subject to voluntary prepayment as
provided in Section 4.01, and mandatory repayment as provided in
Section 4.02 and (vii) be entitled to the benefits of this Agreement
and the other Credit Documents.
(d) Each Bank will note on its internal records the amount
of each Loan made by it and each payment in respect thereof and will
prior to any transfer of any of its Notes endorse on the reverse side
thereof the outstanding principal amount of Loans evidenced thereby.
Failure to make any such notation or any error in such notation shall
not affect the Borrower's obligations in respect of such Loans.
1.06 Conversions. The Borrower shall have the option to
convert, on any Business Day, all or a portion equal to at least the
Minimum Borrowing Amount of the outstanding principal amount of
Revolving Loans made pursuant to one or more Borrowings of one or
more Types of Revolving Loans into a Borrowing of another Type of
Revolving Loan, provided that, (i) except as otherwise provided in
Section 1.10(b), Eurodollar Loans may be converted into Base Rate
Loans only on the last day of an Interest Period applicable to the
Revolving Loans being converted and no such partial conversion of
Eurodollar Loans shall reduce the outstanding principal amount of
such Eurodollar Loans made pursuant to a single Borrowing to less
than the Minimum Borrowing Amount applicable thereto, (ii) Base Rate
Loans may only be converted into Eurodollar Loans if no Default or
Event of Default is in existence on the date of such conversion, and
(iii) no conversion pursuant to this Section 1.06 shall result in a
greater number of Borrowings of Eurodollar Loans than is permitted
under Section 1.02. Each such conversion shall be effected by the
Borrower by giving the Administrative Agent at the Notice Office
prior to 12:00 Noon (New York time) at least three Business Days'
prior notice (each a "Notice of Conversion") specifying the Revolving
Loans to be so converted, the Borrowing or Borrowings pursuant to
which such Revolving Loans were made and, if to be converted into
Eurodollar Loans, the Interest Period to be initially applicable
thereto. The Administrative Agent shall give each Bank prompt notice
of any such proposed conversion affecting any of its Revolving Loans.
Upon any such conversion the proceeds thereof will be deemed to be
applied directly on the day of such conversion to prepay the
outstanding principal amount of the Revolving Loans being converted.
Swingline Loans may not be converted pursuant to this Section 1.06.
1.07 Pro Rata Borrowings. All Borrowings of Revolving
Loans under this Agreement shall be incurred from the Banks pro rata
on the basis of their Revolving Loan Commitments. It is understood
that no Bank shall be responsible for any default by any other Bank
of its obligation to make Revolving Loans hereunder and that each
Bank shall be obligated to make the Revolving Loans provided to be
made by it hereunder, regardless of the failure of any other Bank to
make its Revolving Loans hereunder.
1.08 Interest. (a) The Borrower agrees to pay interest
in respect of the unpaid principal amount of each Base Rate Loan from
the date of Borrowing thereof (or, in the case of a Base Rate Loan
made pursuant to Section 2.05(a), from the date of the respective
Drawing) until the earlier of (i) the maturity thereof (whether by
acceleration or otherwise) and (ii) the conversion of such Base Rate
Loan to a Eurodollar Loan pursuant to Section 1.06, at a rate per
annum which shall be equal to the Base Rate in effect from time to
time.
(b) The Borrower agrees to pay interest in respect of the
unpaid principal amount of each Eurodollar Loan from the date of
Borrowing thereof until the earlier of (i) the maturity thereof (whe-
ther by acceleration or otherwise) and (ii) the conversion of such
Eurodollar Loan to a Base Rate Loan pursuant to Section 1.06, 1.09 or
1.10, as applicable, at a rate per annum which shall, during each
Interest Period applicable thereto, be equal to the sum of the
Applicable Eurodollar Rate Margin plus the Eurodollar Rate for such
Interest Period.
(c) Overdue principal and, to the extent permitted by law,
overdue interest in respect of each Loan and any other overdue amount
payable hereunder shall, in each case, bear interest at a rate per
annum equal to the greater of (x) the rate which is 2% in excess of
the rate then borne by such Loans and (y) the rate which is 2% in
excess of the rate otherwise applicable to Base Rate Loans from time
to time. Interest which accrues under this Section 1.08(c) shall be
payable on demand.
(d) Accrued (and theretofore unpaid) interest shall be
payable (i) in respect of each Base Rate Loan, quarterly in arrears
on each Quarterly Payment Date, (ii) in respect of each Eurodollar
Loan, on the last day of each Interest Period applicable thereto and,
in the case of an Interest Period in excess of three months, on each
date occurring at three month intervals after the first day of such
Interest Period and (iii) in respect of each Loan, on any repayment
or prepayment (on the amount repaid or prepaid), at maturity (whether
by acceleration or otherwise) and, after such maturity, on demand.
(e) Upon each Interest Determination Date, the
Administrative Agent shall determine the Eurodollar Rate for each
Interest Period applicable to Eurodollar Loans and shall promptly
notify the Borrower and the Banks thereof. Each such determination
shall, absent manifest error, be final and conclusive and binding on
all parties hereto.
1.09 Interest Periods. At the time the Borrower gives any
Notice of Borrowing or Notice of Conversion in respect of the making
of, or conversion into, any Eurodollar Loan (in the case of the
initial Interest Period applicable thereto) or on the third Business
Day prior to the expiration of an Interest Period applicable to such
Eurodollar Loan (in the case of any subsequent Interest Period), the
Borrower shall have the right to elect, by giving the Administrative
Agent notice thereof, the interest period (each an "Interest Period")
applicable to such Eurodollar Loan, which Interest Period shall, at
the option of the Borrower, be a one, two, three or six-month period,
provided that:
(i) all Eurodollar Loans comprising a Borrowing shall at
all times have the same Interest Period;
(ii) the initial Interest Period for any Eurodollar Loan
shall commence on the date of Borrowing of such Eurodollar Loan
(including the date of any conversion thereto from a Base Rate
Loan) and each Interest Period occurring thereafter in respect
of such Eurodollar Loan shall commence on the day on which the
next preceding Interest Period applicable thereto expires;
(iii) if any Interest Period for a Eurodollar Loan begins
on a day for which there is no numerically corresponding day in
the calendar month at the end of such Interest Period, such
Interest Period shall end on the last Business Day of such
calendar month;
(iv) if any Interest Period for a Eurodollar Loan would
otherwise expire on a day which is not a Business Day, such
Interest Period shall expire on the next succeeding Business
Day; provided, however, that if any Interest Period for a
Eurodollar Loan would otherwise expire on a day which is not a
Business Day but is a day of the month after which no further
Business Day occurs in such month, such Interest Period shall
expire on the next preceding Business Day;
(v) no Interest Period may be selected at any time when a
Default or an Event of Default is then in existence; and
(vi) no Interest Period in respect of any Borrowing of
Eurodollar Loans shall be selected which extends beyond the
Final Maturity Date.
If by 12:00 Noon (New York time) on the third Business Day prior
to the expiration of any Interest Period applicable to a Borrowing of
Eurodollar Loans, the Borrower has failed to elect a new Interest
Period to be applicable to such Eurodollar Loans as provided above,
the Borrower shall be deemed to have elected to continue such
Eurodollar Loans as a new Borrowing of Eurodollar Loans with a one
month Interest Period, provided that if a Default or an Event of
Default exists on such third preceding Business Day, such Eurodollar
Loans instead shall be converted into Base Rate Loans effective as of
the expiration date of such current Interest Period.
1.10 Increased Costs, Illegality, etc. (a) In the event that
any Bank shall have determined (which determination shall, absent
manifest error, be final and conclusive and binding upon all parties
hereto but, with respect to clause (i) below, may be made only by the
Administrative Agent):
(i) on any Interest Determination Date that, by reason of
any changes arising after the date of this Agreement affecting
the interbank Eurodollar market, adequate and fair means do not
exist for ascertaining the applicable interest rate on the basis
provided for in the definition of Eurodollar Rate; or
(ii) at any time, that such Bank shall incur increased
costs or reductions in the amounts received or receivable
hereunder with respect to any Eurodollar Loan because of (x) any
change since the date of this Agreement in any applicable law or
governmental rule, regulation, order, guideline or request
(whether or not having the force of law) or in the inter-
pretation or administration thereof and including the introduc-
tion of any new law or governmental rule, regulation, order,
guideline or request, such as, for example, but not limited to:
(A) a change in the basis of taxation of payment to such Bank of
the principal of or interest on the Notes or any other amounts
payable hereunder (except for changes in the rate of tax on, or
determined by reference to, the net income or profits of such
Bank, or any franchise tax based on the net income or profits of
such Bank, in either case pursuant to the laws of the
jurisdiction in which such Bank is organized or in which such
Bank's principal office or applicable lending office is located
or any subdivision thereof or therein), but without duplication
of any amounts payable in respect of Taxes pursuant to Section
4.04(a), or (B) a change in official reserve requirements, but,
in all events, excluding reserves to the extent expressly
included in the computation of the Eurodollar Rate and/or (y)
other circumstances since the date of this Agreement affecting
such Bank, the interbank Eurodollar market or the position of
such Bank in such market; or
(iii) at any time, that the making or continuance of any
Eurodollar Loan has been made (x) unlawful by any law or
governmental rule, regulation or order, (y) impossible by
compliance by such Bank in good faith with any governmental
request (whether or not having force of law) or (z)
impracticable as a result of a contingency occurring after the
date of this Agreement which materially and adversely affects
the interbank Eurodollar market;
then, and in any such event, such Bank (or the Administrative Agent,
in the case of clause (i) above) shall promptly give notice (by tele-
phone promptly confirmed in writing) to the Borrower and, except in
the case of clause (i) above, to the Administrative Agent of such
determination (which notice the Administrative Agent shall promptly
transmit to each of the other Banks). Thereafter (x) in the case of
clause (i) above, Eurodollar Loans shall no longer be available until
such time as the Administrative Agent notifies the Borrower and the
Banks that the circumstances giving rise to such notice by the
Administrative Agent no longer exist, and any Notice of Borrowing or
Notice of Conversion given by the Borrower with respect to Eurodollar
Loans which have not yet been incurred (including by way of
conversion) shall be deemed rescinded by the Borrower or, at the
Borrower's option and upon notice to the Administrative Agent,
converted to a Borrowing of Base Rate Loans, (y) in the case of
clause (ii) above, the Borrower shall, subject to the provisions of
Section 13.17 (to the extent applicable), pay to such Bank, upon such
Bank's written request therefor, such additional amounts (in the form
of an increased rate of, or a different method of calculating, inter-
est or otherwise as such Bank in its sole discretion shall determine)
as shall be required to compensate such Bank for such increased costs
or reductions in amounts received or receivable hereunder (a written
notice as to the additional amounts owed to such Bank, showing in
reasonable detail the basis for the calculation thereof, submitted to
the Borrower by such Bank shall, absent manifest error, be final and
conclusive and binding on all the parties hereto) and (z) in the case
of clause (iii) above, the Borrower shall take one of the actions
specified in Section 1.10(b) as promptly as possible and, in any
event, within the time period required by law. Each of the
Administrative Agent and each Bank agrees that if it gives notice to
the Borrower of any of the events described in clause (i), (ii) or
(iii) above, it shall promptly notify the Borrower and, in the case
of any such Bank, the Administrative Agent, if any such event ceases
to exist. If any such event described in clause (iii) above ceases
to exist as to a Bank, the obligations of such Bank to make
Eurodollar Loans and to convert Base Rate Loans into Eurodollar Loans
on the terms and conditions contained herein shall be reinstated.
(b) At any time that any Eurodollar Loan is affected by
the circumstances described in Section 1.10(a)(ii) or (iii), the
Borrower may (and in the case of a Eurodollar Loan affected by the
circumstances described in Section 1.10(a)(iii) the Borrower shall)
either (x) if the affected Eurodollar Loan is then being made
initially or pursuant to a conversion, cancel such Borrowing or
convert such Borrowing to a Base Rate Loan by giving the
Administrative Agent telephonic notice (promptly confirmed in
writing) on the same date that the Borrower was notified by the
affected Bank or the Administrative Agent pursuant to Section
1.10(a)(ii) or (iii) or (y) if the affected Eurodollar Loan is then
outstanding, upon at least three Business Days' written notice to the
Administrative Agent, require the affected Bank to convert such
Eurodollar Loan into a Base Rate Loan, provided that, if more than
one Bank is affected at any time, then all affected Banks must be
treated the same pursuant to this Section 1.10(b).
(c) If any Bank determines that the introduction of or any
change in any applicable law or governmental rule, regulation, order,
guideline, directive or request (whether or not having the force of
law) concerning capital adequacy, or any change in interpretation or
administration thereof by the NAIC or any governmental authority,
central bank or comparable agency, in each case after the date
hereof, will have the effect of increasing the amount of capital
required or expected to be maintained by such Bank or any corporation
controlling such Bank based on the existence of such Bank's Revolving
Loan Commitment hereunder or its obligations hereunder, then the
Borrower shall, subject to the provisions of Section 13.17 (to the
extent applicable), pay to such Bank, upon its written demand
therefor, such additional amounts as shall be required to compensate
such Bank or such other corporation for the increased cost to such
Bank or such other corporation or the reduction in the rate of return
to such Bank or such other corporation as a result of such increase
of capital. In determining such additional amounts, each Bank will
act reasonably and in good faith and will use averaging and attrib-
ution methods which are reasonable, provided that such Bank's deter-
mination of compensation owing under this Section 1.10(c) shall,
absent manifest error, be final and conclusive and binding on all the
parties hereto. Each Bank, upon determining that any additional
amounts will be payable pursuant to this Section 1.10(c), will give
prompt written notice thereof to the Borrower, which notice shall
show in reasonable detail the basis for calculation of such addi-
tional amounts.
1.11 Compensation. The Borrower shall, subject to the
provisions of Section 13.17 (to the extent applicable), compensate
each Bank, upon its written request (which request shall set forth in
reasonable detail the basis for requesting such compensation), for
all losses, expenses and liabilities (including, without limitation,
any loss, expense or liability incurred by reason of the liquidation
or reemployment of deposits or other funds required by such Bank to
fund its Eurodollar Loans but excluding loss of anticipated profits)
which such Bank may sustain: (i) if for any reason (other than a
default by such Bank or the Administrative Agent) a Borrowing of, or
conversion from or into, Eurodollar Loans does not occur on a date
specified therefor in a Notice of Borrowing or Notice of Conversion
(whether or not withdrawn by the Borrower or deemed withdrawn pur-
suant to Section 1.10(a)); (ii) if any repayment (including any re-
payment made pursuant to Section 4.01, Section 4.02 or as a result of
an acceleration of the Loans pursuant to Section 10) or conversion of
any of its Eurodollar Loans occurs on a date which is not the last
day of an Interest Period with respect thereto; (iii) if any pre-
payment of any of its Eurodollar Loans is not made on any date
specified in a notice of prepayment given by the Borrower; or (iv) as
a consequence of (x) any other default by the Borrower to repay its
Loans when required by the terms of this Agreement or any Note held
by such Bank or (y) any election made pursuant to Section 1.10(b).
1.12 Change of Lending Office. Each Bank agrees that upon
the occurrence of any event giving rise to the operation of
Section 1.10(a)(ii) or (iii), Section 1.10(c), Section 2.06 or
Section 4.04 with respect to such Bank, it will, if requested by the
Borrower, use reasonable efforts (subject to overall policy
considerations of such Bank) to designate another lending office for
any Loans or Letters of Credit affected by such event, provided that
such designation is made on such terms that such Bank and its lending
office suffer no economic, legal or regulatory disadvantage, with the
object of avoiding the consequence of the event giving rise to the
operation of such Section. Nothing in this Section 1.12 shall affect
or postpone any of the obligations of the Borrower or the right of
any Bank provided in Sections 1.10, 2.06 and 4.04.
1.13 Replacement of Banks. (x) If any Bank becomes a
Defaulting Bank or otherwise defaults in its obligations to make
Loans, (y) upon the occurrence of an event giving rise to the
operation of Section 1.10(a)(ii) or (iii), Section 1.10(c), Section
2.06 or Section 4.04 with respect to any Bank which results in such
Bank charging to the Borrower increased costs or (z) as provided in
Section 13.12(b) in the case of a refusal by a Bank to consent to
certain proposed changes, waivers, discharges or terminations with
respect to this Agreement which have been approved by the Required
Banks, the Borrower shall have the right, if no Default or Event of
Default then exists (or, in the case of preceding clause (z), no
Default or Event of Default will exist immediately after giving
effect to such replacement), to replace such Bank (the "Replaced
Bank") with one or more other Eligible Transferees, none of whom
shall constitute a Defaulting Bank at the time of such replacement
(collectively, the "Replacement Bank") and each of whom shall be
required to be reasonably acceptable to the Administrative Agent,
provided that (i) at the time of any replacement pursuant to this
Section 1.13, the Replacement Bank shall enter into one or more
Assignment and Assumption Agreements pursuant to Section 13.04(b)
(and with all fees payable pursuant to said Section 13.04(b) to be
paid by the Replacement Bank) pursuant to which the Replacement Bank
shall acquire the entire Revolving Loan Commitment and outstanding
Revolving Loans of, and participations in Letters of Credit by, the
Replaced Bank and, in connection therewith, shall pay to (x) the
Replaced Bank in respect thereof an amount equal to the sum of (I) an
amount equal to the principal of, and all accrued interest on, all
outstanding Revolving Loans of the Replaced Bank, (II) an amount
equal to all Unpaid Drawings that have been funded by (and not
reimbursed to) such Replaced Bank, together with all then unpaid
interest with respect thereto at such time and (III) an amount equal
to all accrued, but theretofore unpaid, Fees owing to the Replaced
Bank pursuant to Section 3.01, (y) each Issuing Bank an amount equal
to such Replaced Bank's RL Percentage of any Unpaid Drawing (which at
such time remains an Unpaid Drawing) to the extent such amount was
not theretofore funded by such Replaced Bank to such Issuing Bank and
(z) the Swingline Bank an amount equal to such Replaced Bank's RL
Percentage of any Mandatory Borrowings to the extent such amount was
not theretofore funded by such Replaced Bank to the Swingline Bank
and (ii) all obligations of the Borrower due and owing to the
Replaced Bank at such time (other than those specifically described
in clause (i) above in respect of which the assignment purchase price
has been, or is concurrently being, paid) shall be paid in full to
such Replaced Bank concurrently with such replacement. Upon the
execution of the respective Assignment and Assumption Agreements, the
payment of amounts referred to in clauses (i) and (ii) above and, if
so requested by the Replacement Bank, delivery to the Replacement
Bank of the appropriate Revolving Note executed by the Borrower, the
Replacement Bank shall become a Bank hereunder and the Replaced Bank
shall cease to constitute a Bank hereunder, except with respect to
indemnification provisions under this Agreement (including, without
limitation, Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01), which
shall survive as to such Replaced Bank.
SECTION 2. Letters of Credit.
2.01 Letters of Credit. (a) Subject to and upon the
terms and conditions set forth herein, the Borrower may request that
an Issuing Bank issue, at any time and from time to time on and after
the Effective Date and prior to the 30th day prior to the Final
Maturity Date, (x) for the account of the Borrower and for the
benefit of any holder (or any trustee, agent or other similar
representative for any such holders) of L/C Supportable Obligations
of the Borrower or any of its Subsidiaries, an irrevocable standby
letter of credit, in a form customarily used by such Issuing Bank or
in such other form as has been approved by such Issuing Bank and (y)
for the account of the Borrower and for the benefit of sellers of
goods to the Borrower or any of its Subsidiaries, an irrevocable
trade letter of credit, in a form customarily used by such Issuing
Bank or in such other form as has been approved by such Issuing Bank
(each such letter of credit issued pursuant to this Section 2.01, a
"Letter of Credit"). All Letters of Credit shall be denominated in
Dollars and shall be issued on a sight basis only. Schedule IX
contains a description of all letters of credit which were issued
pursuant to the Existing Credit Agreement and which are to remain
outstanding on the Effective Date (each such letter of credit, an
"Existing Letter of Credit"). Each such Existing Letter of Credit
shall constitute a Letter of Credit for all purposes of this
Agreement and shall, for purposes of Sections 2.04 and 3.01, be
deemed issued on the Effective Date.
(b) Subject to and upon the terms and conditions set forth
herein, each Issuing Bank agrees that it will, at any time and from
time to time on and after the Effective Date and prior to the 30th
day prior to the Final Maturity Date, following its receipt of the
respective Letter of Credit Request, issue for the account of the
Borrower, one or more Letters of Credit as are permitted to remain
outstanding without giving rise to a Default or an Event of Default,
provided that no Issuing Bank shall be under any obligation to issue
any Letter of Credit of the types described above if at the time of
such issuance:
(i) any order, judgment or decree of any governmental
authority or arbitrator shall purport by its terms to enjoin or
restrain such Issuing Bank from issuing such Letter of Credit or
any requirement of law applicable to such Issuing Bank or any
request or directive (whether or not having the force of law)
from any governmental authority with jurisdiction over such
Issuing Bank shall prohibit, or request that such Issuing Bank
refrain from, the issuance of letters of credit generally or
such Letter of Credit in particular or shall impose upon such
Issuing Bank with respect to such Letter of Credit any
restriction or reserve or capital requirement (for which such
Issuing Bank is not otherwise compensated) not in effect on the
date hereof, or any unreimbursed loss, cost or expense which was
not applicable or in effect with respect to such Issuing Bank as
of the date hereof and which such Issuing Bank reasonably and in
good xxxxx xxxxx material to it; or
(ii) such Issuing Bank shall have received notice from the
Borrower, any other Credit Party or the Required Banks prior to
the issuance of such Letter of Credit of the type described in
the second sentence of Section 2.03(b).
(c) In the event that an Issuing Bank of trade Letters of
Credit is other than the Administrative Agent, such Issuing Bank will
send by facsimile transmission to the Administrative Agent, promptly
on the first Business Day of each week, its daily aggregate Stated
Amount of all trade Letters of Credit for the immediately preceding
week.
2.02 Maximum Letter of Credit Outstandings; Final
Maturities. Notwithstanding anything to the contrary contained in
this Agreement, (i) no Letter of Credit shall be issued the Stated
Amount of which, when added to the Letter of Credit Outstandings (ex-
clusive of Unpaid Drawings which are repaid on the date of, and prior
to the issuance of, the respective Letter of Credit) at such time
would exceed either (x) $50,000,000 or (y) when added to the sum of
the aggregate principal amount of all Revolving Loans then
outstanding and the aggregate principal amount of all Swingline Loans
then outstanding, an amount equal to the Total Revolving Loan
Commitment at such time and (ii) each Letter of Credit shall by its
terms terminate on or before the earlier of (x) (A) in the case of
standby Letters of Credit, the date which occurs 12 months after the
date of the issuance thereof (although any such standby Letter of
Credit may be extendable for successive periods of up to 12 months,
but not beyond the third Business Day prior to the Final Maturity
Date, on terms acceptable to such Issuing Bank (which may include an
automatic extension by the terms of such standby Letter of Credit))
or such longer period of time as shall be agreed to by the respective
Issuing Bank in its sole discretion for any particular standby Letter
of Credit and (B) in the case of trade Letters of Credit, the date
which occurs 180 days after the date of the issuance thereof and (y)
three Business Days (or 30 days in the case of a trade Letter of
Credit) prior to the Final Maturity Date.
2.03 Letter of Credit Requests; Minimum Stated Amount.
(a) Whenever the Borrower desires that a Letter of Credit be issued
for its account, the Borrower shall give the Administrative Agent and
the respective Issuing Bank at least five Business Days' (or such
shorter period as is acceptable to such Issuing Bank) written notice
thereof. Each notice shall be in the form of Exhibit C (each a
"Letter of Credit Request").
(b) The making of each Letter of Credit Request shall be
deemed to be a representation and warranty by the Borrower that such
Letter of Credit may be issued in accordance with, and will not
violate the requirements of, Section 2.02. Unless the respective
Issuing Bank has received notice from the Borrower, any other Credit
Party or the Required Banks before it issues a Letter of Credit that
one or more of the conditions specified in Section 6 are not then
satisfied, or that the issuance of such Letter of Credit would
violate Section 2.02, then such Issuing Bank shall, subject to the
terms and conditions of this Agreement, issue the requested Letter of
Credit for the account of the Borrower in accordance with such
Issuing Bank's usual and customary practices. Upon its issuance of
or amendment to any standby Letter of Credit, the respective Issuing
Bank shall promptly notify the Borrower and the Administrative Agent
of such issuance or amendment and such notification shall be accom-
panied by a copy of the issued standby Letter of Credit or amendment.
Notwithstanding anything to the contrary contained in this Agreement,
in the event that a Bank Default exists, no Issuing Bank shall be
required to issue any Letter of Credit unless such Issuing Bank has
entered into an arrangement satisfactory to it and the Borrower to
eliminate such Issuing Bank's risk with respect to the participation
in Letters of Credit by the Defaulting Bank or Banks, including by
cash collateralizing such Defaulting Bank's or Banks' RL Percentage
of the Letter of Credit Outstandings.
(c) The initial Stated Amount of each Letter of Credit
shall not be less than $100,000 or such lesser amount as is
acceptable to the respective Issuing Bank.
2.04 Letter of Credit Participations. (a) Immediately
upon the issuance by each Issuing Bank of any Letter of Credit, such
Issuing Bank shall be deemed to have sold and transferred to each
Bank, other than such Issuing Bank (each such Bank, in its capacity
under this Section 2.04, a "Participant"), and each such Participant
shall be deemed irrevocably and unconditionally to have purchased and
received from such Issuing Bank, without recourse or warranty, an
undivided interest and participation, to the extent of such
Participant's RL Percentage, in such Letter of Credit, each drawing
or payment made thereunder and the obligations of the Borrower under
this Agreement with respect thereto, and any security therefor or
guaranty pertaining thereto. Upon any change in the Revolving Loan
Commitments or RL Percentages of the Banks pursuant to Section 1.13
or 13.04, it is hereby agreed that, with respect to all outstanding
Letters of Credit and Unpaid Drawings, there shall be an automatic
adjustment to the participations pursuant to this Section 2.04 to
reflect the new RL Percentages of the assignor and assignee Bank, as
the case may be.
(b) In determining whether to pay under any Letter of
Credit issued by it, no Issuing Bank shall have an obligation
relative to the other Banks other than to confirm that any documents
required to be delivered under such Letter of Credit appear to have
been delivered and that they appear to substantially comply on their
face with the requirements of such Letter of Credit. Any action
taken or omitted to be taken by any Issuing Bank under or in
connection with any Letter of Credit issued by it if taken or omitted
in the absence of gross negligence or willful misconduct (as finally
determined by a court of competent jurisdiction), shall not create
for such Issuing Bank any resulting liability to the Borrower, any
other Credit Party, any Bank or any other Person.
(c) In the event that any Issuing Bank makes any payment
under any Letter of Credit issued by it and the Borrower shall not
have reimbursed such amount in full to such Issuing Bank pursuant to
Section 2.05(a), such Issuing Bank shall promptly notify the
Administrative Agent, which shall promptly notify each Participant of
such failure, and, except as provided in the proviso of the
immediately succeeding sentence, each Participant shall promptly and
unconditionally pay to such Issuing Bank the amount of such
Participant's RL Percentage of such unreimbursed payment in Dollars
and in same day funds. If the Administrative Agent so notifies,
prior to 12:00 Noon (New York time) on any Business Day, any
Participant required to fund a payment under a Letter of Credit, such
Participant shall make available to the respective Issuing Bank in
Dollars such Participant's RL Percentage of the amount of such
payment on such Business Day in same day funds; provided, however,
that no Participant shall be obligated to pay to the respective
Issuing Bank its RL Percentage of such unreimbursed amount for any
wrongful payment made by such Issuing Bank under a Letter of Credit
issued by it as a result of acts or omissions constituting willful
misconduct or gross negligence on the part of such Issuing Bank (as
finally determined by a court of competent jurisdiction). If and to
the extent such Participant shall not have so made its RL Percentage
of the amount of such payment available to the respective Issuing
Bank, such Participant agrees to pay to such Issuing Bank, forthwith
on demand such amount, together with interest thereon, for each day
from such date until the date such amount is paid to such Issuing
Bank at the overnight Federal Funds Rate for the first three days and
at the interest rate applicable to Base Rate Loans for each day
thereafter. The failure of any Participant to make available to the
respective Issuing Bank its RL Percentage of any payment under any
Letter of Credit shall not relieve any other Participant of its
obligation hereunder to make available to such Issuing Bank its RL
Percentage of any Letter of Credit on the date required, as specified
above, but no Participant shall be responsible for the failure of any
other Participant to make available to such Issuing Bank such other
Participant's RL Percentage of any such payment.
(d) Whenever an Issuing Bank receives a payment of a xxxx-
bursement obligation as to which it has received any payments from
the Participants pursuant to clause (c) above, such Issuing Bank
shall pay to each Participant which has paid its RL Percentage
thereof, in Dollars and in same day funds, an amount equal to such
Participant's share (based upon the proportionate aggregate amount
originally funded by such Participant to the aggregate amount funded
by all Participants) of the principal amount of such reimbursement
obligation and interest thereon accruing after the purchase of the
respective participations.
(e) Upon the request of any Participant, each Issuing Bank
shall furnish to such Participant copies of any standby Letter of
Credit issued by it and such other documentation as may reasonably be
requested by such Participant.
(f) The obligations of the Participants to make payments
to each Issuing Bank with respect to Letters of Credit issued by it
shall be irrevocable and not subject to any qualification or
exception whatsoever (except as otherwise provided in the proviso to
the second sentence of Section 2.04(c)) and shall be made in accor-
dance with the terms and conditions of this Agreement under all
circumstances, including, without limitation, any of the following
circumstances:
(i) any lack of validity or enforceability of this
Agreement or any of the other Credit Documents;
(ii) the existence of any claim, setoff, defense or other
right which the Borrower or any of its Subsidiaries may have at
any time against a beneficiary named in a Letter of Credit, any
transferee of any Letter of Credit (or any Person for whom any
such transferee may be acting), the Administrative Agent, any
Issuing Bank, any Participant, or any other Person, whether in
connection with this Agreement, any Letter of Credit, the trans-
actions contemplated herein or any unrelated transactions
(including any underlying transaction between the Borrower or
any Subsidiary of the Borrower and the beneficiary named in any
such Letter of Credit);
(iii) any draft, certificate or any other document
presented under any Letter of Credit proving to be forged,
fraudulent, invalid or insufficient in any respect or any
statement therein being untrue or inaccurate in any respect;
(iv) the surrender or impairment of any security for the
performance or observance of any of the terms of any of the
Credit Documents; or
(v) the occurrence of any Default or Event of Default.
2.05 Agreement to Repay Letter of Credit Drawings.
(a) The Borrower agrees to reimburse each Issuing Bank, by making
payment to the Administrative Agent in Dollars and in immediately
available funds at the Payment Office, for any payment or
disbursement made by such Issuing Bank under any Letter of Credit
issued by it (each such amount so paid until reimbursed, an "Unpaid
Drawing"), not later than one Business Day following the date of such
payment or disbursement, with interest on the amount so paid or dis-
bursed by such Issuing Bank, to the extent not reimbursed prior to
2:00 P.M. (New York time) on the date of such payment or disbursement
(or to the extent such Unpaid Drawing is repaid with a Borrowing of
Base Rate Loans pursuant to clause (ii) of the proviso below), from
and including the date paid or disbursed to but excluding the date
such Issuing Bank was reimbursed by the Borrower therefor at a rate
per annum which shall be the Base Rate in effect from time to time;
provided, however, (i) to the extent such amounts are not reimbursed
prior to 2:00 P.M. (New York time) on the third Business Day
following the date of such payment or disbursement, interest shall
thereafter accrue on the amounts so paid or disbursed by such Issuing
Bank (and until reimbursed by the Borrower) at a rate per annum which
shall be the Base Rate in effect from time to time plus 2% (but
without duplication of any amounts paid pursuant to Section 1.08(c)),
in each such case, with interest to be payable on demand and (ii) (x)
unless the Borrower shall have notified the Administrative Agent and
the respective Issuing Bank prior to 12:00 Noon (New York time) on
the date of such payment or disbursement (to the extent that the
amount thereof equals or exceeds $1,000,000) that the Borrower
intends to reimburse such Issuing Bank for the amount of such Drawing
with funds other than the proceeds of Revolving Loans, then so long
as all of the conditions precedent set forth in Section 6.02 are then
satisfied, the Borrower shall be deemed to have given a timely Notice
of Borrowing to the Administrative Agent for a Borrowing of Revolving
Loans constituting Base Rate Loans to be made on the immediately
succeeding Business Day in the amount of such Drawing and (y) so long
as all of the conditions precedent set forth in Section 6.02 are then
satisfied, each Bank shall, in accordance with Section 1.04, make
available to the Administrative Agent its pro rata portion of such
Borrowing on such immediately succeeding Business Day (and with the
proceeds thereof to be applied directly by the Administrative Agent
to reimburse such Issuing Bank for the amount of such Drawing),
provided further, however, that if for any reason proceeds of
Revolving Loans are not so received by such Issuing Bank in an amount
equal to such Drawing, the Borrower shall reimburse such Issuing
Bank, on demand, in an amount equal to the excess of the amount of
such Drawing over the aggregate amount of such Revolving Loans, if
any, which are so received. Each Issuing Bank shall give the
Borrower and the Administrative Agent prompt written notice of each
Drawing under any Letter of Credit issued by it, provided that the
failure to give any such notice shall in no way affect, impair or
diminish the Borrower's obligations hereunder.
(b) The obligations of the Borrower under this Section
2.05 to reimburse each Issuing Bank with respect to Unpaid Drawings
(including, in each case, interest thereon) shall be absolute and
unconditional under any and all circumstances and irrespective of any
setoff, counterclaim or defense to payment which the Borrower may
have or have had against any Bank (including in its capacity as
issuer of the Letter of Credit or as Participant), including, without
limitation, any defense based upon the failure of any drawing or
payment under a Letter of Credit (each a "Drawing") to conform to the
terms of the Letter of Credit or any nonapplication or misapplication
by the beneficiary of the proceeds of such Drawing; provided,
however, that the Borrower shall not be obligated to reimburse the
respective Issuing Bank for any wrongful payment made by such Issuing
Bank under a Letter of Credit issued by it as a result of acts or
omissions constituting willful misconduct or gross negligence on the
part of such Issuing Bank (as finally determined by a court of
competent jurisdiction).
2.06 Increased Costs. If any Issuing Bank or Participant
determines that the introduction of or any change in any applicable
law, rule, regulation, order, guideline or request or in the
interpretation or administration thereof by the NAIC or any
governmental authority charged with the interpretation or
administration thereof, or compliance by such Issuing Bank or
Participant with any request or directive by the NAIC or by any such
authority (whether or not having the force of law), in each case
after the date hereof, shall either (i) impose, modify or make
applicable any reserve, deposit, capital adequacy or similar
requirement against letters of credit issued by such Issuing Bank or
participated in by such Participant, or (ii) impose on such Issuing
Bank or Participant any other conditions relating, directly or
indirectly, to this Agreement; and the result of any of the foregoing
is to increase the cost to such Issuing Bank or Participant of issu-
ing, maintaining or participating in any Letter of Credit, or reduce
the amount of any sum received or receivable by such Issuing Bank or
Participant hereunder or reduce the rate of return on its capital
with respect to Letters of Credit (except for changes in the rate of
tax on, or determined by reference to, the net income or profits of
such Issuing Bank or Participant, or any franchise tax based on the
net income or profits of such Issuing Bank or Participant, in either
case pursuant to the laws of the jurisdiction in which it is organ-
ized or in which its principal office or applicable lending office is
located or any subdivision thereof or therein), but without
duplication of any amounts payable in respect of Taxes pursuant to
Section 4.04(a), then, upon the delivery of the certificate referred
to below to the Borrower by such Issuing Bank or Participant (a copy
of which certificate shall be sent by such Issuing Bank or Partici-
pant to the Administrative Agent), the Borrower shall, subject to the
provisions of Section 13.17 (to the extent applicable), pay to such
Issuing Bank or Participant such additional amount or amounts as will
compensate such Issuing Bank or Participant for such increased cost
or reduction in the amount receivable or reduction on the rate of
return on its capital. Each Issuing Bank or Participant, upon deter-
mining that any additional amounts will be payable to it pursuant to
this Section 2.06, will give prompt written notice thereof to the
Borrower, which notice shall include a certificate submitted to the
Borrower by such Issuing Bank or Participant (a copy of which
certificate shall be sent by such Issuing Bank or Participant to the
Administrative Agent), setting forth in reasonable detail the basis
for the calculation of such additional amount or amounts necessary to
compensate such Issuing Bank or Participant. The certificate re-
quired to be delivered pursuant to this Section 2.06 shall, absent
manifest error, be final and conclusive and binding on the Borrower.
SECTION 3. Commitment Commission; Fees; Reductions of
Commitment.
3.01 Fees. (a) The Borrower agrees to pay to the
Administrative Agent for distribution to each Non-Defaulting Bank, a
commitment commission (the "Commitment Commission") for the period
from and including the Effective Date to but excluding the Final
Maturity Date (or such earlier date on which the Total Revolving Loan
Commitment shall have been terminated), computed at a rate for each
day equal to the Applicable Commitment Commission Percentage on the
daily average Unutilized Revolving Loan Commitment of such Non-
Defaulting Bank. Accrued Commitment Commission shall be due and
payable quarterly in arrears on each Quarterly Payment Date and on
the Final Maturity Date (or such earlier date on which the Total
Revolving Loan Commitment shall have been terminated).
(b) The Borrower agrees to pay to the Administrative Agent
for distribution to each Bank (based on each such Bank's respective
RL Percentage) a fee in respect of each Letter of Credit issued here-
under (the "Letter of Credit Fee") for the period from and including
the date of issuance of such Letter of Credit to and including the
date of termination or expiration of such Letter of Credit, computed
at a rate per annum equal to the Applicable Eurodollar Rate Margin
then in effect on the daily Stated Amount of such Letter of Credit.
Accrued Letter of Credit Fees shall be due and payable quarterly in
arrears on each Quarterly Payment Date and on the first day after the
termination of the Total Revolving Loan Commitment upon which no
Letters of Credit remain outstanding.
(c) The Borrower agrees to pay to each Issuing Bank, for
its own account, a facing fee in respect of each Letter of Credit
issued by such Issuing Bank hereunder (the "Facing Fee") for the
period from and including the date of issuance of such Letter of
Credit to and including the date of termination or expiration of such
Letter of Credit, computed at a rate per annum equal to / of 1% (or
such lesser percentage as shall be agreed to in writing between the
Borrower and the respective Issuing Bank) on the daily Stated Amount
of such Letter of Credit, provided that in any event the minimum
amount of the Facing Fee payable in any 12 month period for each
Letter of Credit shall be $500 (or such lesser amount as shall be
agreed to in writing between the Borrower and the respective Issuing
Bank); it being agreed that, on the date of issuance of any Letter of
Credit and on each anniversary thereof prior to the termination of
such Letter of Credit, if $500 (or such lesser amount, as the case
may be) will exceed the amount of Facing Fees that will accrue with
respect to such Letter of Credit for the immediately succeeding 12
month period, the full $500 (or such lesser amount, as the case may
be) shall be payable on the date of issuance of such Letter of Credit
and on each such anniversary thereof. Except as otherwise provided
in the proviso to the immediately preceding sentence, accrued Facing
Fees shall be due and payable quarterly in arrears on each Quarterly
Payment Date and upon the first day after the termination of the
Total Revolving Loan Commitment upon which no Letters of Credit
remain outstanding.
(d) The Borrower agrees to pay to each Issuing Bank, for
its own account, upon each payment under, issuance of, or amendment
to, any Letter of Credit, such amount as shall at the time of such
event be the administrative charge and the reasonable expenses which
such Issuing Bank is generally imposing in connection with such
occurrence with respect to letters of credit.
(e) The Borrower agrees to pay to the Agents and the
Banks, for their own account, such other fees as have been agreed to
in writing by the Borrower and the Agents.
3.02 Voluntary Termination of Unutilized Commitments.
(a) Upon at least one Business Day's prior written notice to the
Administrative Agent at the Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks),
the Borrower shall have the right, at any time or from time to time,
without premium or penalty, to terminate the Total Unutilized Revolv-
ing Loan Commitment, in whole or in part, pursuant to this Section
3.02(a), in an amount equal to at least $2,000,000 and in integral
multiples of $1,000,000 in excess thereof, in the case of partial
reductions to the Total Unutilized Revolving Loan Commitment,
provided that each such reduction shall apply proportionately to
permanently reduce the Revolving Loan Commitment of each Bank.
(b) In the event of a refusal by a Bank to consent to
certain proposed changes, waivers, discharges or terminations with
respect to this Agreement which have been approved by the Required
Banks as (and to the extent) provided in Section 13.12(b), the
Borrower may, subject to its compliance with the requirements of
Section 13.12(b), upon five Business Days' prior written notice to
the Administrative Agent at the Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks)
terminate the Revolving Loan Commitment of such Bank, so long as all
Revolving Loans, together with accrued and unpaid interest, Fees and
all other amounts, owing to such Bank are repaid concurrently with
the effectiveness of such termination pursuant to Section 4.01(b) (at
which time Schedule I shall be deemed modified to reflect such
changed amounts), and at such time, such Bank shall no longer
constitute a "Bank" for purposes of this Agreement, except with
respect to indemnifications under this Agreement (including, without
limitation, Sections 1.10, 1.11, 2.06, 4.04, 12.06 and 13.01), which
shall survive as to such repaid Bank.
3.03 Mandatory Reduction of Commitments. (a) The Total
Revolving Loan Commitment (and the Revolving Loan Commitment of each
Bank) shall terminate in their entirety on October 31, 1997 unless
the Effective Date has occurred on or before such date.
(b) In addition to any other mandatory commitment
reductions pursuant to this Section 3.03, on the third Business Day
following each date on or after the Effective Date on which Holdings
or any of its Subsidiaries receives Cash Proceeds from any Asset
Sale, the Total Revolving Loan Commitment shall be permanently
reduced by an amount equal to 100% of the Net Sale Proceeds from such
Asset Sale, provided that such Net Sale Proceeds shall not give rise
to a reduction to the Total Revolving Loan Commitment pursuant to
this Section 3.03(b) on such date to the extent that no Default or
Event of Default then exists and the Borrower delivers a certificate
to the Administrative Agent on or prior to such date stating that
such Net Sale Proceeds shall be used to purchase assets used or to be
used in the businesses permitted pursuant to Section 9.14 within 365
days following the date of receipt of such Net Sale Proceeds from
such Asset Sale (which certificate shall set forth the estimates of
the proceeds to be so expended), and provided further, that if all or
any portion of such Net Sale Proceeds are not so used within such 365
day period, the Total Revolving Loan Commitment shall be permanently
reduced on the last day of such period by an amount equal to such
remaining portion.
(c) In addition to any other mandatory commitment
reductions pursuant to this Section 3.03, on each date on or after
the Effective Date on which Holdings or any of its Subsidiaries
receives any cash proceeds from any incurrence of Indebtedness for
borrowed money (other than Indebtedness for borrowed money permitted
to be incurred pursuant to Section 9.04 as such Section is in effect
on the Effective Date) by Holdings or any of its Subsidiaries, the
Total Revolving Loan Commitment shall be permanently reduced on such
date by an amount equal to (i) 100% of the Net Debt Proceeds from the
respective incurrence of Indebtedness if on the date of receipt of
such Net Debt Proceeds (and after giving effect to the incurrence
thereof and the application of the proceeds thereof) the Leverage
Ratio is equal to or greater than 2.50:1.00 or (ii) 50% of the Net
Debt Proceeds from the respective incurrence of Indebtedness if on
the date of receipt of such Net Debt Proceeds (and after giving
effect to the incurrence thereof and the application of the proceeds
thereof) the Leverage Ratio is less than 2.50:1.00.
(d) In addition to any other mandatory commitment
reductions pursuant to this Section 3.03, within 10 days following
each date on or after the Effective Date on which Holdings or any of
its Subsidiaries receives any cash proceeds from any Recovery Event,
the Total Revolving Loan Commitment shall be permanently reduced on
such date by an amount equal to 100% of the Net Insurance Proceeds of
such Recovery Event, provided that so long as no Default or Event of
Default then exists, such proceeds shall not give rise to a reduction
to the Total Revolving Loan Commitment pursuant to this Section
3.03(d) on such date to the extent that the Borrower has delivered a
certificate to the Administrative Agent on or prior to such date
stating that such proceeds shall be used to replace or restore any
properties or assets in respect of which such proceeds were paid
within 365 days following the date of receipt of such proceeds (which
certificate shall set forth the estimates of the proceeds to be so
expended), and provided further, that if all or any portion of such
proceeds are not so used within such 365 day period, the Total
Revolving Loan Commitment shall be permanently reduced on the last
day of such period by an amount equal to such remaining portion.
(e) In addition to any other mandatory commitment
reductions pursuant to this Section 3.03, on each date on or after
the Effective Date on which Holdings or any of its Subsidiaries
receives any cash proceeds from any return of any surplus assets of
any Pension Plan of Holdings or any of its Subsidiaries, the Total
Revolving Loan Commitment shall be permanently reduced on such date
by an amount equal to 100% of the Net Reversion Amount from such
return of surplus assets.
(f) In addition to any other mandatory commitment
reductions pursuant to this Section 3.03, in the event that Senior
Subordinated Notes in an aggregate principal amount exceeding
$20,000,000 remain outstanding on the Effective Date and after giving
effect to the consummation of the Senior Subordinated Note Tender
Offer, the Total Revolving Loan Commitment shall be permanently
reduced on such date by an amount equal to the aggregate principal
amount of all Senior Subordinated Notes that remain so outstanding
(and not just the portion in excess of $20,000,000).
(g) In addition to any other mandatory commitment
reductions pursuant to this Section 3.03, the Total Revolving Loan
Commitment (and the Revolving Loan Commitment of each Bank) shall
terminate in its entirety on the earlier of (i) the date on which a
Change of Control occurs and (ii) the Final Maturity Date.
(h) Each reduction to the Total Revolving Loan Commitment
pursuant to this Section 3.03 shall apply proportionately to
permanently reduce the Revolving Loan Commitment of each Bank.
SECTION 4. Prepayments; Payments; Taxes.
4.01 Voluntary Prepayments. (a) The Borrower shall have
the right to prepay the Loans, without premium or penalty, in whole
or in part at any time and from time to time on the following terms
and conditions: (i) the Borrower shall give the Administrative Agent
prior to 12:00 Noon (New York time) at the Notice Office (x) at least
one Business Day's prior written notice (or telephonic notice
promptly confirmed in writing) of its intent to prepay Base Rate
Loans (or same day notice in the case of a prepayment of Swingline
Loans) and (y) at least three Business Days' prior written notice (or
telephonic notice promptly confirmed in writing) of its intent to
prepay Eurodollar Loans, the amount of such prepayment, whether
Revolving Loan or Swingline Loans shall be prepaid and the Types of
Loans to be prepaid and, in the case of Eurodollar Loans, the spec-
ific Borrowing or Borrowings pursuant to which made, which notice the
Administrative Agent shall, except in the case of Swingline Loans,
promptly transmit to each of the Banks; (ii) each prepayment of
Eurodollar Loans pursuant to this Section 4.01(a) shall be in an
aggregate principal amount of at least $5,000,000 and integral
multiples of $1,000,000 in excess thereof, each prepayment of Base
Rate Loans (other than Swingline Loans) pursuant to this Section
4.01(a) shall be in an aggregate principal amount of at least
$2,000,000 and integral multiples of $500,000 in excess thereof, and
each prepayment of Swingline Loans pursuant to this Section 4.01(a)
shall be in an aggregate principal amount of at least $100,000,
provided that if any partial prepayment of Eurodollar Loans made
pursuant to any Borrowing shall reduce the outstanding principal
amount of Eurodollar Loans made pursuant to such Borrowing to an
amount less than the Minimum Borrowing Amount applicable thereto,
then such Borrowing may not be continued as a Borrowing of Eurodollar
Loans and any election of an Interest Period with respect thereto
given by the Borrower shall have no force or effect; and (iii) each
prepayment pursuant to this Section 4.01(a) in respect of any
Revolving Loans made pursuant to a Borrowing shall be applied pro
rata among such Revolving Loans, provided that at the Borrower's
election in connection with any prepayment of Revolving Loans
pursuant to this Section 4.01(a), such prepayment shall not be
applied to any Revolving Loan of a Defaulting Bank.
(b) In the event of a refusal by a Bank to consent to
certain proposed changes, waivers, discharges or terminations with
respect to this Agreement which have been approved by the Required
Banks as (and to the extent) provided in Section 13.12(b), the
Borrower may, upon five Business Days' prior written notice to the
Administrative Agent at the Notice Office (which notice the
Administrative Agent shall promptly transmit to each of the Banks)
repay all Revolving Loans of such Bank, together with accrued and
unpaid interest, Fees and other amounts owing to such Bank in accor-
dance with, and subject to the requirements of, said Section 13.12(b)
so long as (A) the Revolving Loan Commitment of such Bank is
terminated concurrently with such repayment pursuant to Section
3.02(b) (at which time Schedule I shall be deemed modified to reflect
the changed Revolving Loan Commitments) and (B) the consents, if any,
required under Section 13.12(b) in connection with the repayment
pursuant to this clause (b) have been obtained.
4.02 Mandatory Repayments. (a) On any day on which the
sum of (I) the aggregate outstanding principal amount of all
Revolving Loans (after giving effect to all other repayments thereof
on such date), (II) the aggregate outstanding principal amount of all
Swingline Loans (after giving effect to all other repayments thereof
on such date) and (III) the aggregate amount of all Letter of Credit
Outstandings exceeds the Total Revolving Loan Commitment as then in
effect, the Borrower shall prepay on such day the principal of
Swingline Loans and, after all Swingline Loans have been repaid in
full, Revolving Loans in an amount equal to such excess. If, after
giving effect to the prepayment of all outstanding Swingline Loans
and Revolving Loans, the aggregate amount of the Letter of Credit
Outstandings exceeds the Total Revolving Loan Commitment as then in
effect, the Borrower shall pay to the Administrative Agent at the
Payment Office on such day an amount of cash and/or Cash Equivalents
equal to the amount of such excess (up to a maximum amount equal to
the Letter of Credit Outstandings at such time), such cash and/or
Cash Equivalents to be held as security for all obligations of the
Borrower to the Issuing Banks and the Banks hereunder pursuant to the
Collateral Account Agreement.
(b) With respect to each repayment of Revolving Loans re-
quired by this Section 4.02, the Borrower may designate the Types of
Revolving Loans which are to be repaid and, in the case of Eurodollar
Loans, the specific Borrowing or Borrowings pursuant to which made,
provided that: (i) repayments of Eurodollar Loans pursuant to this
Section 4.02 may only be made on the last day of an Interest Period
applicable thereto unless all Eurodollar Loans with Interest Periods
ending on such date of required repayment and all Base Rate Loans
have been paid in full; (ii) if any repayment of Eurodollar Loans
made pursuant to a single Borrowing shall reduce the outstanding
Eurodollar Loans made pursuant to such Borrowing to an amount less
than the Minimum Borrowing Amount applicable thereto, such Borrowing
shall be converted at the end of the then current Interest Period
into a Borrowing of Base Rate Loans; and (iii) each repayment of any
Revolving Loans made pursuant to a Borrowing shall be applied pro
rata among such Revolving Loans. In the absence of a designation by
the Borrower as described in the preceding sentence, the
Administrative Agent shall, subject to the above, make such
designation in its sole discretion.
(c) Notwithstanding anything to the contrary contained in
this Agreement or in any other Credit Document, (i) all then
outstanding Revolving Loans shall be repaid in full on the Final
Maturity Date, (ii) all then outstanding Swingline Loans shall be
repaid in full on the Swingline Expiry Date and (iii) all then
outstanding Loans shall be repaid in full on the date on which a
Change of Control occurs.
4.03 Method and Place of Payment. Except as otherwise
specifically provided herein, all payments under this Agreement or
under any Note shall be made to the Administrative Agent for the
account of the Bank or Banks entitled thereto not later than 1:00
P.M. (New York time) on the date when due and shall be made in
Dollars in immediately available funds at the Payment Office.
Whenever any payment to be made hereunder or under any Note shall be
stated to be due on a day which is not a Business Day, the due date
thereof shall be extended to the next succeeding Business Day and,
with respect to payments of principal, interest shall be payable at
the applicable rate during such extension.
4.04 Net Payments. (a) All payments made by the Borrower
hereunder or under any Note will be made without setoff, counterclaim
or other defense. Except as provided in Section 4.04(b), all such
payments will be made free and clear of, and without deduction or
withholding for, any present or future taxes, levies, imposts,
duties, fees, assessments or other charges of whatever nature now or
hereafter imposed by any jurisdiction or by any political subdivision
or taxing authority thereof or therein with respect to such payments
(but excluding, except as provided in the second succeeding sentence,
any tax imposed on or measured by the net income or profits of a Bank
pursuant to the laws of the jurisdiction in which such Bank is
organized or the jurisdiction in which the principal office or
applicable lending office of such Bank is located or any subdivision
thereof or therein) and all interest, penalties or similar
liabilities with respect to such non-excluded taxes, levies, imposts,
duties, fees, assessments or other charges (all such non-excluded
taxes, levies, imposts, duties, fees, assessments or other charges
being referred to collectively as "Taxes"). If any Taxes are so
levied or imposed, the Borrower agrees to pay the full amount of such
Taxes, and such additional amounts as may be necessary so that every
payment of all amounts due under this Agreement or under any Note,
after withholding or deduction for or on account of any Taxes, will
not be less than the amount provided for herein or in such Note. If
any amounts are payable in respect of Taxes pursuant to the preceding
sentence, the Borrower agrees to reimburse each Bank, upon the
written request of such Bank, for taxes imposed on or measured by the
net income or profits of such Bank pursuant to the laws of the
jurisdiction in which such Bank is organized or in which the
principal office or applicable lending office of such Bank is located
or under the laws of any political subdivision or taxing authority of
any such jurisdiction in which such Bank is organized or in which the
principal office or applicable lending office of such Bank is located
and for any withholding of taxes as such Bank shall determine are
payable by, or withheld from, such Bank, in respect of such amounts
so paid to or on behalf of such Bank pursuant to the preceding
sentence and in respect of any amounts paid to or on behalf of such
Bank pursuant to this sentence. The Borrower will furnish to the
Administrative Agent within 45 days after the date the payment of any
Taxes is due pursuant to applicable law certified copies of tax
receipts evidencing such payment by the Borrower. The Borrower
agrees to indemnify and hold harmless each Bank, and reimburse such
Bank upon its written request, for the amount of any Taxes so levied
or imposed and paid by such Bank.
(b) Each Bank that is not a United States person (as such
term is defined in Section 7701(a)(30) of the Code) for U.S. Federal
income tax purposes agrees to deliver to the Borrower and the
Administrative Agent on or prior to the Effective Date, or in the
case of a Bank that is an assignee or transferee of an interest under
this Agreement pursuant to Section 1.13 or 13.04 (unless the
respective Bank was already a Bank hereunder immediately prior to
such assignment or transfer), on the date of such assignment or
transfer to such Bank, (i) two accurate and complete original signed
copies of Internal Revenue Service Form 4224 or 1001 (or successor
forms) certifying to such Bank's entitlement to a complete exemption
from United States withholding tax with respect to payments to be
made under this Agreement and under any Note, or (ii) if the Bank is
not a "bank" within the meaning of Section 881(c)(3)(A) of the Code
and cannot deliver either Internal Revenue Service Form 1001 or 4224
(or successor forms) pursuant to clause (i) above, (x) a certificate
substantially in the form of Exhibit D (any such certificate, a
"Section 4.04(b)(ii) Certificate") and (y) two accurate and complete
original signed copies of Internal Revenue Service Form W-8 (or
successor form) certifying to such Bank's entitlement to a complete
exemption from United States withholding tax with respect to payments
of interest to be made under this Agreement and under any Note. In
addition, each Bank agrees that from time to time after the Effective
Date, when a lapse in time or change in circumstances renders the
previous certification obsolete or inaccurate in any material
respect, such Bank will deliver to the Borrower and the
Administrative Agent two new accurate and complete original signed
copies of Internal Revenue Service Form 4224 or 1001 (or successor
forms), or Form W-8 (or successor form) and a Section 4.04(b)(ii)
Certificate, as the case may be, and such other forms as may be
required in order to confirm or establish the entitlement of such
Bank to a continued exemption from or reduction in United States
withholding tax with respect to payments under this Agreement and any
Note, or such Bank shall immediately notify the Borrower and the
Agent of its inability to deliver any such Form or Certificate, in
which case such Bank shall not be required to deliver any such Form
or Certificate pursuant to this Section 4.04(b). Notwithstanding
anything to the contrary contained in Section 4.04(a), but subject to
Section 13.04(b) and the immediately succeeding sentence, (x) the
Borrower shall be entitled, to the extent it is required to do so by
law, to deduct or withhold income or similar taxes imposed by the
United States (or any political subdivision or taxing authority
thereof or therein) from interest, Fees or other amounts payable
hereunder for the account of any Bank which is not a United States
person (as such term is defined in Section 7701(a)(30) of the Code)
for U.S. Federal income tax purposes to the extent that such Bank has
not provided to the Borrower U.S. Internal Revenue Service Forms that
establish a complete exemption from such deduction or withholding and
(y) the Borrower shall not be obligated pursuant to Section 4.04(a)
hereof to gross-up payments to be made to a Bank in respect of income
or similar taxes imposed by the United States if (I) such Bank has
not provided to the Borrower the Internal Revenue Service Forms
required to be provided to the Borrower pursuant to this Section
4.04(b) or (II) in the case of a payment, other than interest, to a
Bank described in clause (ii) above, to the extent that such Forms do
not establish a complete exemption from withholding of such taxes.
Notwithstanding anything to the contrary contained in the preceding
sentence or elsewhere in this Section 4.04 and except as set forth in
Section 13.04(b), the Borrower agrees to pay any additional amounts
and to indemnify each Bank in the manner set forth in Section 4.04(a)
(without regard to the identity of the jurisdiction requiring the
deduction or withholding) in respect of any Taxes deducted or with-
held by it as described in the immediately preceding sentence as a
result of any changes after the Effective Date in any applicable law,
treaty, governmental rule, regulation, guideline or order, or in the
interpretation thereof, relating to the deducting or withholding of
such Taxes.
SECTION 5. Conditions Precedent to the Effective Date.
The occurrence of the Effective Date pursuant to Section 13.10 is
subject to the satisfaction or waiver of the following conditions:
5.01 Execution of Agreement; Notes On or prior to the
Effective Date, (i) this Agreement shall have been executed and
delivered as provided in Section 13.10 and (ii) there shall have been
delivered to the Administrative Agent for the account of each of the
Banks that has requested a Revolving Note the appropriate Revolving
Note executed by the Borrower and to the Swingline Bank to the extent
requested thereby, the Swingline Note executed by the Borrower, in
each case, in the amount, maturity and as otherwise provided herein.
5.02 Officers' Certificate. On the Effective Date, the
Administrative Agent shall have received a certificate, dated the
Effective Date and signed on behalf of the Borrower by the chairman
of the board, the chief executive officer, the president, the chief
financial officer or any vice president of the Borrower, certifying
on behalf of the Borrower that all of the conditions in Sections
5.06, 5.07, 5.08, 5.09, 5.10 and 6.02 have been satisfied on such
date.
5.03 Opinions of Counsel. On the Effective Date, the
Administrative Agent shall have received from (i) Xxxxxx & Xxxxxxx,
special counsel to the Credit Parties (other than the Land Trusts),
an opinion addressed to the Administrative Agent, the Syndication
Agent, the Collateral Agent and each of the Banks and dated the
Effective Date covering the matters set forth in Exhibit E-1 and such
other matters incident to the transactions contemplated herein as any
Agent may reasonably request, and (ii) internal counsel of Holdings,
an opinion addressed to the Administrative Agent, the Syndication
Agent, the Collateral Agent and each of the Banks and dated the
Effective Date covering the matters set forth in Exhibit E-2 and such
other matters incident to the transactions contemplated herein as any
Agent may reasonably request.
5.04 Corporate Documents; Proceedings; etc. (a) On the
Effective Date, the Administrative Agent shall have received a
certificate from (i) each Credit Party (other than the Land Trusts),
dated the Effective Date, signed on behalf of such Credit Party by
the chairman of the board, the chief executive officer, the
president, the chief financial officer or any vice president of such
Credit Party, and attested to by the secretary or any assistant
secretary of such Credit Party, in the form of Exhibit F with
appropriate insertions, together with copies of the certificate or
articles of incorporation (or equivalent organizational document) and
by-laws of such Credit Party and the resolutions of such Credit Party
referred to in such certificate and (ii) each Land Trust, dated on or
prior to the Effective Date and signed on behalf on such Land Trust
by an authorized representative thereof, together with certified
copies of the organizational documents of such Land Trust, and all of
the foregoing shall be in form and substance reasonably acceptable to
the Agents.
(b) All corporate, trust and legal proceedings and all
instruments and agreements in connection with the transactions
contemplated by this Agreement and the other Documents shall be
reasonably satisfactory in form and substance to the Agents and the
Required Banks, and the Administrative Agent shall have received all
information and copies of all documents and papers, including records
of corporate proceedings, governmental approvals, good standing
certificates and bring-down telegrams or facsimiles, if any, which
any Agent reasonably may have requested in connection therewith, such
documents and papers where appropriate to be certified by proper
corporate, trust or governmental authorities.
5.05 Shareholders' Agreements; Management Agreements; Tax
Sharing Agreements. On or prior to the Effective Date, the
Administrative Agent shall have received a certificate from Holdings
certifying that, with respect to the following documents, there have
been no new such documents entered into after November 1, 1996:
(i) all material agreements entered into by Holdings
governing the terms and relative rights of its capital stock and
any agreements entered into by shareholders relating to Holdings
with respect to its capital stock (collectively, the "Share-
holders' Agreements");
(ii) all material management or consulting agreements with
members of, or with respect to, the management of Holdings or
any of its Subsidiaries (collectively, the "Management
Agreements"); and
(iii) all tax sharing, tax allocation and other similar
agreements entered into by Holdings or any of its Subsidiaries
(collectively, the "Tax Sharing Agreements").
5.06 Senior Subordinated Note Tender Offer; Senior
Subordinated Note Consents; Senior Subordinated Note Indenture
Supplement. (a) On the Effective Date, the Borrower shall have
accepted for payment all Senior Subordinated Notes issued by it to
the extent tendered and not withdrawn pursuant to the Senior
Subordinated Note Tender Offer and each of the conditions to such
purchase as set forth in the Senior Subordinated Note Tender Offer
Documents shall have been satisfied and not waived to the
satisfaction of the Agents and the Required Banks. All terms and
conditions of the Senior Subordinated Note Tender Offer shall be
reasonably satisfactory to the Agents and the Required Banks
(including, without limitation, the maximum tender price for such
Senior Subordinated Notes) and the Senior Subordinated Note Tender
Offer shall be conducted in compliance with the Senior Subordinated
Note Tender Offer Documents and all applicable laws (including,
without limitation, Federal and state securities laws).
(b) On the Effective Date, in the event 100% of the Senior
Subordinated Notes have not been accepted for payment by the Borrower
pursuant to the Senior Subordinated Note Tender Offer, the Borrower
shall have received sufficient Senior Subordinated Note Consents
pursuant to the Senior Subordinated Note Consent Solicitation to
authorize the execution and delivery of the Senior Subordinated Note
Indenture Supplement and the Senior Subordinated Note Indenture
Supplement shall have been duly executed and delivered by the
Borrower and the Senior Subordinated Note Indenture Trustee and all
conditions to the effectiveness thereof shall have been satisfied.
All of the terms and conditions of the Senior Subordinated Note
Consent Solicitation and the Senior Subordinated Note Indenture
Supplement (including, without limitation, the amount of the payments
made to the holders of the Senior Subordinated Notes in connection
with the Senior Subordinated Note Consent Solicitation and the
amendments effected to the Senior Subordinated Note Indenture
pursuant to the Senior Subordinated Note Indenture Supplement) shall
be reasonably satisfactory to the Agents and the Required Banks and
in compliance with the Senior Subordinated Note Consent Solicitation
Documents and all applicable laws (including, without limitation,
Federal and state securities laws).
(c) On the Effective Date, there shall have been delivered to
the Administrative Agent true and correct copies of all Senior
Subordinated Note Tender Offer Documents and Senior Subordinated Note
Consent Solicitation Documents (including executed versions of the
Senior Subordinated Note Indenture Supplement), all of which Senior
Subordinated Note Tender Offer Documents and Senior Subordinated Note
Consent Solicitation Documents shall be in form and substance
reasonably satisfactory to the Agents and the Required Banks. The
Administrative Agent shall have received evidence in form, scope and
substance satisfactory to it that the matters set forth in this
Section 5.06 have been satisfied at such time.
5.07 Bank Refinancing. On the Effective Date, the Bank
Refinancing shall have been consummated and all documents in respect
of, and all Liens securing (and guaranties of), the Existing Credit
Assignment shall have been released and/or terminated, as
appropriate, in each case to the reasonable satisfaction of the
Agents. The Administrative Agent shall have received copies of all
documents executed in connection with the Bank Refinancing (including
(i) proper UCC-3 (or the appropriate equivalent) termination
statements, (ii) releases for any patents, trademarks, copyrights, or
similar interests and (iii) releases for all mortgages, leasehold
mortgages, deeds of trust and leasehold deeds of trust) all of which
shall be in full force and effect and in form and substance
reasonably satisfactory to the Agents.
5.08 Synthetic Lease Amendment. On the Effective Date,
(i) the SL Documents shall have been amended on terms and conditions,
and pursuant to documentation, reasonably satisfactory to the Agents
and the Required Banks, (ii) the Administrative Agent shall have
received true and correct copies of all documentation evidencing such
amendment, and (iii) the SL Documents, as so amended, shall be in
full force and effect and no default or event of default shall exist
thereunder.
5.09 Adverse Change, etc. (a) Nothing shall have
occurred (and neither the Agents nor the Banks shall have become
aware of any facts or conditions not previously known) which the
Agents or the Required Banks shall determine (a) has had, or could
reasonably be expected to have, a material adverse effect on the
rights or remedies of the Banks or the Agents, or on the ability of
any Credit Party to perform its obligations to the Banks or the
Agents hereunder or under any other Credit Document or (b) has had,
or could reasonably be expected to have, a material adverse effect on
the Transaction or on the business, operations, property, assets,
liabilities or condition (financial or otherwise) of the Borrower and
the Guarantors taken as a whole.
(b) On or prior to the Effective Date, all necessary
governmental (domestic and foreign) and third party approvals and/or
consents in connection with the Transaction and the other trans-
actions contemplated by the Documents and otherwise referred to
herein or therein shall have been obtained and remain in effect
(including, without limitation, any approvals and/or consents under
the Illinois Responsible Property Transfer Act). Additionally, there
shall not exist any judgment, order, injunction or other restraint
issued or filed or a hearing seeking injunctive relief or other
restraint pending or notified prohibiting or imposing materially ad-
verse conditions upon the Transaction or the other transactions
contemplated by this Agreement and the other Documents or otherwise
referred to herein or therein.
5.10 Litigation. On the Effective Date, there shall be
no actions, suits or proceedings pending or threatened (i) with
respect to the Transaction, this Agreement or any other Document or
(ii) except as disclosed in Schedule X, which the Agents or the
Required Banks shall determine could reasonably be expected to have a
material adverse effect on (a) the Transaction or on the business,
operations, property, assets, liabilities or condition (financial or
otherwise) of the Borrower and the Guarantors taken as a whole, (b)
the rights or remedies of the Banks or the Agents hereunder or under
any other Credit Document or (c) the ability of any Credit Party to
perform its respective obligations to the Banks or the Agents
hereunder or under any other Credit Document.
5.11 Pledge Agreements. On the Effective Date, (i)
Holdings shall have duly authorized, executed and delivered the
Holdings Pledge Agreement in the form of Exhibit G-1 (as amended,
modified or supplemented from time to time, the "Holdings Pledge
Agreement"), (ii) the Borrower shall have duly authorized, executed
and delivered the Borrower Pledge Agreement in the form of Exhibit G-
2 (as amended, modified or supplemented from time to time, the
"Borrower Pledge Agreement") and (iii) each Subsidiary Guarantor
shall have duly authorized, executed and delivered the Subsidiary
Pledge Agreement in the form of Exhibit G-3 (as amended, modified or
supplemented from time to time, the "Subsidiary Pledge Agreement"),
and each such Credit Party shall have delivered to the Collateral
Agent, as secured party thereunder, all of the Pledged Collateral, if
any, referred to therein and owned by such Credit Party, (x) endorsed
in blank in the case of notes or other evidences of indebtedness
constituting Pledged Collateral and (y) together with executed and
undated stock powers in the case of capital stock constituting
Pledged Collateral.
5.12 Security Agreements. On the Effective Date, (i)
Holdings shall have duly authorized, executed and delivered the
Holdings Security Agreement in the form of Exhibit H-1 (as amended,
modified or supplemented from time to time, the "Holdings Security
Agreement"), (ii) the Borrower shall have duly authorized, executed
and delivered the Borrower Security Agreement in the form of Exhibit
H-2 (as amended, modified or supplemented from time to time, the
"Borrower Security Agreement") and (iii) each Subsidiary Guarantor
shall have duly authorized, executed and delivered the Subsidiary
Security Agreement in the form of Exhibit H-3 (as amended, modified
or supplemented from time to time, the "Subsidiary Security
Agreement"), in each case covering all of such Credit Party's present
and future Security Agreement Collateral, together with:
(i) proper Financing Statements (Form UCC-1 or the
equivalent) fully executed for filing under the UCC or other
appropriate filing offices of each jurisdiction as may be
necessary or, in the reasonable opinion of the Collateral Agent,
desirable to perfect the security interests purported to be
created by each Security Agreement;
(ii) certified copies of Form UCC-11 search results, or
equivalent reports, listing all effective financing statements
that name any Credit Party or any of its Subsidiaries as debtor
and that are filed in the jurisdictions referred to in clause
(i) above, together with copies of such other financing state-
ments that name any Credit Party or any of its Subsidiaries as
debtor (none of which shall cover the Collateral except to the
extent evidencing Permitted Liens or in respect of which the
Collateral Agent shall have received termination statements
(Form UCC-3) or such other termination statements as shall be
required by local law fully executed for filing);
(iii) evidence of the completion of all other recordings
and filings of, or with respect to, each Security Agreement as
may be necessary or, in the reasonable opinion of the Collateral
Agent, desirable to perfect the security interests intended to
be created by each such Security Agreement; and
(iv) evidence that all other actions necessary or, in the
reasonable opinion of the Collateral Agent, desirable to perfect
and protect the security interests purported to be created by
each Security Agreement have been taken.
5.13 Trademark Security Agreements. On the Effective
Date, (i) the Borrower shall have duly authorized, executed and
delivered the Borrower Trademark Collateral Security Agreement and
Conditional Assignment in the form of Exhibit I-1 (as amended,
modified or supplemented from time to time, the "Borrower Trademark
Security Agreement") and (ii) each Subsidiary Guarantor shall have
duly authorized, executed and delivered the Subsidiary Trademark
Collateral Security Agreement and Conditional Assignment in the form
of Exhibit I-2 (as amended, modified or supplemented from time to
time, the "Subsidiary Trademark Security Agreement"), in each case
covering all of such Credit Party's present and future Trademark Col-
lateral, together with:
(i) proper Conditional Assignments of Security Interest
(in the forms contained in each such Trademark Security
Agreement) and Financing Statements (Form UCC-1 or the
equivalent), in each case fully executed for filing under the
UCC or other appropriate filing offices (including, without
limitation, the United States Patent and Trademark Office and
the United States Copyright Office) as may be necessary or, in
the reasonable opinion of the Collateral Agent, desirable to
perfect the security interests purported to be created by each
Trademark Security Agreement;
(ii) evidence of the completion of all other recordings
and filings of, or with respect to, each Trademark Security
Agreement as may be necessary or, in the reasonable opinion of
the Collateral Agent, desirable to perfect the security
interests intended to be created by each such Trademark Security
Agreement; and
(iii) evidence that all other actions necessary or, in the
reasonable opinion of the Collateral Agent, desirable to perfect
and protect the security interests purported to be created by
each Trademark Security Agreement have been taken.
5.14 Collateral Account Agreement. On the Effective Date,
the Borrower shall have duly authorized, executed and delivered the
Collateral Account Agreement in the form of Exhibit J (as amended,
modified, or supplemented from time to time, the "Collateral Account
Agreement").
5.15 Subsidiaries Guaranty. On the Effective Date, each
Subsidiary Guarantor shall have duly authorized, executed and
delivered the Subsidiaries Guaranty in the form of Exhibit K (as
amended, modified or supplemented from time to time, the
"Subsidiaries Guaranty").
5.16 Mortgages; Title Insurance; etc. On the Effective
Date, the Collateral Agent shall have received:
(i) fully executed counterparts of Mortgages, in form and
substance reasonably satisfactory to the Agents, which Mortgages
shall cover the Mortgaged Properties owned or leased by the
Credit Parties on the Effective Date as designated on Schedule
III, together with evidence that counterparts of those Mortgages
encumbering a fee owned Mortgaged Property have been delivered
to the title insurance company insuring the Lien of such Mort-
gages for recording in all places to the extent necessary or, in
the reasonable opinion of the Collateral Agent, desirable, to
effectively create a valid and enforceable first priority
mortgage lien on each such Mortgaged Property (subject only to
Permitted Liens) in favor of the Collateral Agent (or such other
trustee as may be required or desired under local law) for the
benefit of the Secured Creditors;
(ii) a mortgagee title insurance policy (or a binding
commitment with respect thereto) on each such fee owned Mort-
gaged Property (the "Mortgage Policies") issued by a title
insurer reasonably satisfactory to the Agents in amounts
reasonably satisfactory to the Agents assuring the Collateral
Agent that the Mortgages on such Mortgaged Properties are valid
and enforceable first priority mortgage liens on the respective
Mortgaged Properties, free and clear of all defects and encum-
brances except Permitted Liens and such Mortgage Policies shall
otherwise be in form and substance reasonably satisfactory to
the Agents, and shall include, as appropriate, an endorsement
for future advances under this Agreement and the Notes, shall
not include an exception for mechanics' liens, shall provide for
affirmative insurance and such reinsurance as the Agents may
reasonably request and shall provide for any other matter that
Agents may reasonably request;
(iii) such landlord waivers, consents and/or estoppel
certificates as the Agents may have reasonably requested and as
the Borrower may have reasonably been able to obtain, which
landlord waivers, consents and/or estoppel certificates shall be
in form and substance reasonably satisfactory to the Agents; and
(iv) certified copies of the land trust agreement and all
related documentation with respect to any Land Trust by which
title to any of the Mortgaged Properties is held, including
evidence of the release of any collateral assignments of
beneficial interests with respect thereto and certified copies
of authorization by the Borrower for execution of all Credit
Documents by the Land Trustee. Pursuant to Section 90/4(b) of
the Illinois Responsible Property Transfer Act of 1988, the
parties hereto acknowledge that they understand the purpose and
intent of the environmental disclosure required pursuant to such
statute and hereby waive the 30-day time periods with respect to
notice of such disclosure.
5.17 SL Credit Documents. (a) On the Effective Date, the
XX Xxxxxx shall have duly authorized, executed and delivered the SL
Guaranty in the form of Exhibit L (as amended, modified or
supplemented from time to time, the "XX Xxxxxx Guaranty").
(b) On the Effective Date, the XX Xxxxxx shall have duly
authorized, executed and delivered amendments to the existing XX
Xxxxxx Collateral Documents in form and substance reasonably
satisfactory to the Agents and the Required Banks.
5.18 Intercreditor Agreement. On the Effective Date, the
SL Agent, the Collateral Agent and the XX Xxxxxx shall have duly
authorized, executed and deliver the Intercreditor Agreement in the
form of Exhibit M (as amended, modified or supplemented from time to
time, the "Intercreditor Agreement").
5.19 Financial Statements; Pro Forma Balance Sheet;
Projections. On or prior to the Effective Date, the Administrative
Agent shall have received true and correct copies of the historical
financial statements, the pro forma balance sheet and the Projections
referred to in Sections 7.05(a) and (d), which historical financial
statements, pro forma balance sheet and Projections shall be in form
and substance reasonably satisfactory to the Agents and the Required
Banks.
5.20 Solvency Certificate; Insurance Certificates. On the
Effective Date, the Administrative Agent shall have received:
(i) a solvency certificate from the chief financial
officer of Holdings in the form of Exhibit N; and
(ii) certificates of insurance complying with the require-
ments of Section 8.03 for the business and properties of the
Borrower and its Subsidiaries, in form and substance reasonably
satisfactory to the Agents and naming the Collateral Agent as an
additional insured and as loss payee, as applicable, and stating
that such insurance shall not be cancelled without at least 30
days prior written notice by the respective insurer to the
Collateral Agent.
5.21 Fees, etc. On the Effective Date, the Borrower shall
have paid to the Agents and the Banks all costs, fees and expenses
(including, without limitation, legal fees and expenses) payable to
such Persons to the extent then due.
SECTION 6. Conditions Precedent to All Credit Events. The
obligation of each Bank to make Loans (including Loans made on the
Effective Date but excluding Revolving Loans made pursuant to a
Mandatory Borrowing), and the obligation of each Issuing Bank to
issue Letters of Credit, is subject, at the time of each such Credit
Event (except as hereinafter indicated), to the satisfaction of the
following conditions:
6.01 Effective Date. The Effective Date shall have
occurred.
6.02 No Default; Representations and Warranties. At the
time of each such Credit Event and also after giving effect thereto
(i) there shall exist no Default or Event of Default, (ii) there
shall exist no Default (as defined in Annex A to the SL Participation
Agreement) or Event of Default (as defined in Annex A to the SL
Participation Agreement) and (iii) all representations and warranties
contained herein and in the other Credit Documents shall be true and
correct in all material respects with the same effect as though such
representations and warranties had been made on the date of such
Credit Event (it being understood and agreed that any representation
or warranty which by its terms is made as of a specified date shall
be required to be true and correct in all material respects only as
of such specified date).
6.03 Notice of Borrowing; Letter of Credit Request. (a)
Prior to the making of each Revolving Loan, the Administrative Agent
shall have received a Notice of Borrowing meeting the requirements of
Section 1.03(a). Prior to the making of each Swingline Loan, the
Swingline Bank shall have received the notice referred to in Section
1.03(b)(i).
(b) Prior to the issuance of each Letter of Credit, the
Administrative Agent and the respective Issuing Bank shall have
received a Letter of Credit Request meeting the requirements of
Section 2.03.
The acceptance of the benefits of each Credit Event shall
constitute a representation and warranty by Holdings and the Borrower
to the Administrative Agent and each of the Banks that all the condi-
tions specified in Section 5 (with respect to Credit Events on the
Effective Date) and in this Section 6 (with respect to Credit Events
on or after the Effective Date) and applicable to such Credit Event
exist as of that time. All of the Notes, certificates, legal opin-
ions and other documents and papers referred to in Section 5 and in
this Section 6, unless otherwise specified, shall be delivered to the
Administrative Agent at the Notice Office for the account of each of
the Banks and, except for the Notes, in sufficient counterparts or
copies for each of the Banks and shall be in form and substance
reasonably satisfactory to the Agents and the Required Banks.
SECTION 7. Representations, Warranties and Agreements. In
order to induce the Banks to enter into this Agreement and to make
the Loans and issue (or participate in) the Letters of Credit as
provided herein, each of Holdings and the Borrower makes the
following representations, warranties and agreements, in each case
after giving effect to the Transaction, all of which shall survive
the execution and delivery of this Agreement and the Notes and the
making of the Loans and issuance of the Letters of Credit, with the
occurrence of the Effective Date and the occurrence of each Credit
Event on or after the Effective Date being deemed to constitute a
representation and warranty that the matters specified in this
Section 7 are true and correct on and as of the Effective Date and on
the date of each such Credit Event (it being understood and agreed
that any representation or warranty which by its terms is made as of
a specified date shall be required to be true and correct only as of
such specified date).
7.01 Corporate Status. Each of Holdings and each of its
Subsidiaries (i) is a duly organized and validly existing corporation
or, in the case of a Land Trust, a duly organized and validly
existing land trust, in either case in good standing under the laws
of the jurisdiction of its organization, (ii) has the corporate or
trust power and authority to own its property and assets and to
transact the business in which it is engaged and presently proposes
to engage and (iii) is duly qualified and is authorized to do
business and is in good standing in each jurisdiction where the
ownership, leasing or operation of its property or the conduct of its
business requires such qualifications except for failures to be so
qualified which, individually or in the aggregate, could not
reasonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Guarantors taken as
a whole.
7.02 Corporate and Other Power and Authority. Each Credit
Party has the corporate or trust power and authority to execute,
deliver and perform the terms and provisions of each of the Documents
to which it is party and has taken all necessary corporate or trust
action to authorize the execution, delivery and performance by it of
each of such Documents. Each Credit Party has duly executed and
delivered each of the Documents to which it is party, and each of
such Documents constitutes its legal, valid and binding obligation
enforceable in accordance with its terms, except to the extent that
the enforceability thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws
generally affecting creditors' rights and by equitable principles
(regardless of whether enforcement is sought in equity or at law).
7.03 No Violation. Neither the execution, delivery or
performance by any Credit Party of the Documents to which it is a
party, nor compliance by it with the terms and provisions thereof,
(i) will contravene any provision of any law, statute, rule or regu-
lation or any order, writ, injunction or decree of any court or
governmental instrumentality, (ii) will conflict with or result in
any breach of any of the terms, covenants, conditions or provisions
of, or constitute a default under, or result in the creation or
imposition of (or the obligation to create or impose) any Lien
(except pursuant to the Security Documents and the SL Collateral
Documents) upon any of the property or assets of Holdings or any of
its Subsidiaries pursuant to the terms of any material indenture,
mortgage, deed of trust, credit agreement or loan agreement, or any
other material agreement, contract or instrument, to which Holdings
or any of its Subsidiaries is a party or by which it or any of its
property or assets is bound or to which it may be subject or (iii)
will violate any provision of the certificate or articles of
incorporation or by-laws (or equivalent organizational documents) of
Holdings or any of its Subsidiaries.
7.04 Approvals. No order, consent, approval, license,
authorization or validation of, or filing, recording or registration
with (except for (i) those that have otherwise been obtained or made
on or prior to the Effective Date and which remain in full force and
effect on the Effective Date, (ii) those filings required under the
Security Documents to perfect the security interests created thereby
and (iii) the filing required by Section 90/4(b) of the Illinois
Responsible Property Transfer Act of 1988), or exemption by, any
governmental or public body or authority, or any subdivision thereof,
is required to authorize, or is required in connection with, (i) the
execution, delivery and performance of any Document by any Credit
Party or (ii) the legality, validity, binding effect or
enforceability of any such Document against any Credit Party.
7.05 Financial Statements; Financial Condition;
Undisclosed Liabilities; Projections; etc. (a) The consolidated
balance sheets of Holdings and its Subsidiaries and of the Borrower
and its Subsidiaries for the fiscal year and nine month period ended
on November 2, 1996 and August 9, 1997, respectively, and the related
consolidated statements of income, cash flows and shareholders'
equity of Holdings and its Subsidiaries and of the Borrower and its
Subsidiaries for the fiscal year or nine month period, as the case
may be, ended on such dates, copies of which have been furnished to
the Banks on or prior to the Effective Date, present fairly in all
material respects the consolidated financial position of Holdings and
its Subsidiaries and of the Borrower and its Subsidiaries, as
applicable, at the dates of such balance sheets and the consolidated
results of the operations of Holdings and its Subsidiaries and the
Borrower and its Subsidiaries for the periods covered thereby. All
of the foregoing financial statements have been prepared in
accordance with generally accepted accounting principles consistently
applied subject, in the case of the August 9, 1997 financial
statements, to changes resulting from audit and normal year-end
adjustments. The pro forma consolidated balance sheets of Holdings
and its Subsidiaries and the Borrower and its Subsidiaries, in each
case as of November 1, 1997 and after giving effect to the
Transaction, a copy of which has been furnished to the Banks prior to
the Effective Date, presents fairly in all material respects the pro
forma consolidated financial position of Holdings and its
Subsidiaries and the Borrower and its Subsidiaries, in each case as
of November 1, 1997. Since November 2, 1996, no event or change of
any kind or character has occurred that has had, or could reasonably
be expected to have, a material adverse affect on the business,
operations, property, assets, liabilities or condition (financial or
otherwise) of the Borrower and the Guarantors taken as a whole.
(b) On and as of the Effective Date and after giving
effect to the Transaction and to the Loans being incurred on the
Effective Date and the Liens created by the Credit Parties in
connection therewith, (a) the sum of the assets, at a fair valuation,
of each of the Borrower on a stand-alone basis and of the Borrower
and the Guarantors taken as a whole will exceed its debts; (b) each
of the Borrower on a stand-alone basis and the Borrower and the
Guarantors taken as a whole has not incurred and does not intend to
incur, and does not believe that it will incur, debts beyond its
ability to pay such debts as such debts mature; and (c) each of the
Borrower on a stand alone basis and the Borrower and the Guarantors
taken as a whole will have sufficient capital with which to conduct
its business. For purposes of this Section 7.05(b), "debt" means any
liability on a claim, and "claim" means (i) right to payment, whether
or not such a right is reduced to judgment, liquidated, unliquidated,
fixed, contingent, matured, unmatured, disputed, undisputed, legal,
equitable, secured, or unsecured or (ii) right to an equitable remedy
for breach of performance if such breach gives rise to a payment,
whether or not such right to an equitable remedy is reduced to judg-
ment, fixed, contingent, matured, unmatured, disputed, undisputed,
secured or unsecured. The amount of contingent liabilities at any
time shall be computed as the amount that, in the light of all the
facts and circumstances existing at such time, represents the amount
that can reasonably be expected to become an actual or matured
liability.
(c) Except as fully disclosed in the financial statements
delivered pursuant to Section 7.05(a), there were as of the Effective
Date no liabilities or obligations with respect to Holdings or any of
its Subsidiaries of any nature whatsoever (whether absolute, accrued,
contingent or otherwise and whether or not due) which, either in-
dividually or in aggregate, could reasonably be expected to have a
material adverse affect on the business, operations, property,
assets, liabilities or condition (financial or otherwise) of the
Borrower and the Guarantors taken as a whole. As of the Effective
Date, neither Holdings nor the Borrower knows of any basis for the
assertion against it or any of its Subsidiaries of any liability or
obligation of any nature whatsoever that is not fully disclosed in
the financial statements delivered pursuant to Section 7.05(a) which,
either individually or in the aggregate, could reasonably be expected
to have a material adverse affect on the business, operations,
property, assets, liabilities or condition (financial or otherwise)
of the Borrower and the Guarantors taken as a whole.
(d) On and as of the Effective Date, the Projections
delivered to the Agents and the Banks prior to the Effective Date
have been prepared in good faith and are based on reasonable
assumptions, and there are no statements or conclusions in the Pro-
jections which are based upon or include information known to
Holdings or the Borrower to be misleading in any material respect or
which fail to take into account material information known to
Holdings or the Borrower regarding the matters reported therein. On
the Effective Date, each of Holdings and the Borrower believes that
the Projections are reasonable and attainable, it being recognized by
the Banks, however, that projections as to future events are not to
be viewed as facts and that the actual results during the period or
periods covered by the Projections may differ from the projected
results and that the differences may be material.
7.06 Litigation. There are no actions, suits or
proceedings pending or, to the best knowledge of Holdings and the
Borrower, threatened (i) with respect to the Transaction, this
Agreement or any other Document or (ii) except as disclosed on
Schedule X, that are reasonably likely to materially and adversely
affect the business, operations, property, assets, liabilities or
condition (financial or otherwise) of the Borrower and the Guarantors
taken as a whole.
7.07 True and Complete Disclosure. All factual
information (taken as a whole) furnished by or on behalf of any
Credit Party in writing to any Agent or any Bank (including, without
limitation, all information contained in the Documents) for purposes
of or in connection with this Agreement, the other Credit Documents
or any transaction contemplated herein or therein is, and all other
such factual information (taken as a whole) hereafter furnished by or
on behalf of any Credit Party in writing to any Agent or any Bank
will be, true and accurate in all material respects on the date as of
which such information is dated or certified and not incomplete by
omitting to state any fact necessary to make such information (taken
as a whole) not misleading in any material respect at such time in
light of the circumstances under which such information was provided.
7.08 Use of Proceeds; Margin Regulations. (a) All
proceeds of the Loans shall be used for the working capital and
general corporate purposes of Holdings and its Subsidiaries
(including, without limitation, to effect the Transaction and to pay
fees and expenses incurred in connection therewith).
(b) No part of any Credit Event (or the proceeds thereof)
will be used to purchase or carry any Margin Stock or to extend
credit for the purpose of purchasing or carrying any Margin Stock
except in connection with the repurchase of shares of stock of
Holdings as permitted by Section 9.03. The value of all Margin Stock
at any time owned by Holdings and its Subsidiaries does not, and will
not, exceed 25% of the value of the assets of Holdings and its
Subsidiaries taken as a whole. Neither the making of any Loan nor
the use of the proceeds thereof nor the occurrence of any other
Credit Event will violate or be inconsistent with the provisions of
Regulation G, T, U or X of the Board of Governors of the Federal
Reserve System.
7.09 Tax Returns and Payments. Each of Holdings and each
of its Subsidiaries has filed all federal and state income tax
returns and all other material tax returns required to be filed by it
and has paid all material taxes and assessments payable by it which
have become due, except for those contested in good faith and ade-
quately disclosed and fully provided for on the financial statements
of Holdings and its Subsidiaries in accordance with generally
accepted accounting principles. Holdings and each of its Subsi-
diaries have at all times paid, or have provided adequate reserves
(in the good faith judgment of the management of Holdings) for the
payment of, all material income taxes applicable for all prior fiscal
years and for the current fiscal year to date. There is no material
action, suit, proceeding, investigation, audit or claim now pending
or, to the knowledge of Holdings or the Borrower threatened, by any
authority regarding any taxes relating to Holdings or any of its
Subsidiaries. As of the Effective Date, neither Holdings nor any of
its Subsidiaries has entered into an agreement or waiver or been
requested to enter into an agreement or waiver extending any statute
of limitations relating to the payment or collection of taxes of
Holdings or any of its Subsidiaries, or is aware of any circumstances
that would cause the taxable years or other taxable periods of
Holdings or any of its Subsidiaries not to be subject to the normally
applicable statute of limitations.
7.10 Compliance with ERISA. Except to the extent that any
of the following, either individually or in the aggregate, could
reasonably be expected to have a material adverse affect on the
business, operations, property, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Guarantors taken as
a whole: each Plan (and each related trust, insurance contract or
fund) is in compliance with its terms and with all applicable laws,
including, without limitation, ERISA and the Code; each Plan (and
each related trust, if any) which is intended to be qualified under
Section 401(a) of the Code has received a determination letter from
the Internal Revenue Service to the effect that it meets the
requirements of Sections 401(a) and 501(a) of the Code or a request
for such a determination has been submitted and has not been denied;
no Reportable Event has occurred; to the knowledge of Holdings and
the Borrower, no Plan which is a multiemployer plan (as defined in
Section 4001(a)(3) of ERISA) is insolvent or in reorganization; no
Plan has an Unfunded Current Liability; no Plan which is subject to
Section 412 of the Code or Section 302 of ERISA has an accumulated
funding deficiency, within the meaning of such sections of the Code
or ERISA, or has applied for or received a waiver of an accumulated
funding deficiency or an extension of any amortization period, within
the meaning of Section 412 of the Code or Section 303 or 304 of
ERISA; all contributions required to be made with respect to a Plan
have been timely made; neither Holdings nor any Subsidiary of
Holdings nor any ERISA Affiliate has incurred any liability
(including any indirect, contingent or secondary liability) to or on
account of a Plan pursuant to Section 409, 502(i), 502(l), 515, 4062,
4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or Section 401(a)(29),
4971 or 4975 of the Code or expects to incur any such liability under
any of the foregoing sections with respect to any Plan; no condition
exists which presents a risk to Holdings or any Subsidiary of
Holdings or any ERISA Affiliate of incurring a liability to or on
account of a Plan pursuant to the foregoing provisions of ERISA and
the Code; no proceedings have been instituted to terminate or appoint
a trustee to administer any Plan which is subject to Title IV of
ERISA; no action, suit, proceeding, hearing, audit or investigation
with respect to the administration, operation or the investment of
assets of any Plan (other than routine claims for benefits) is
pending, reasonably expected or threatened; using actuarial
assumptions and computation methods consistent with Part 1 of
subtitle E of Title IV of ERISA, the aggregate liabilities of
Holdings and its Subsidiaries and its ERISA Affiliates to all Plans
which are multiemployer plans (as defined in Section 4001(a)(3) of
ERISA) in the event of a complete withdrawal therefrom, as of the
close of the most recent fiscal year of each such Plan ended prior to
the date of the most recent Credit Event, would not be material; each
group health plan (as defined in Section 607(1) of ERISA or Section
4980B(g)(2) of the Code) which covers or has covered employees or
former employees of Holdings, any Subsidiary of Holdings, or any
ERISA Affiliate has at all times been operated in compliance with the
provisions of Part 6 of subtitle B of Title I of ERISA and Section
4980B of the Code; no lien imposed under the Code or ERISA on the
assets of Holdings or any Subsidiary of Holdings or any ERISA
Affiliate exists or is likely to arise on account of any Plan; and
Holdings and its Subsidiaries may cease contributions to or terminate
any employee benefit plan maintained by any of them without incurring
any liability.
7.11 The Security Documents. (a) At all times prior to
the Collateral Release Date, the provisions of each of the Security
Agreements are effective to create in favor of the Collateral Agent
for the benefit of the Secured Creditors a legal, valid and
enforceable security interest in all right, title and interest of the
Credit Parties in the Security Agreement Collateral described
therein, and the Collateral Agent, for the benefit of the Secured
Creditors, has a fully perfected first lien on, and security interest
in, all right, title and interest in all of the Security Agreement
Collateral described therein to the extent the Security Agreement
Collateral consists of the type of property in which a security
interest may be perfected by filing a financing statement under the
UCC as enacted in any relevant jurisdiction, subject to no other
Liens other than Permitted Liens.
(b) At all times prior to the Collateral Release Date, the
provisions of each of the Trademark Security Agreements are effective
to create in favor of the Collateral Agent for the benefit of the
Secured Creditors a legal, valid and enforceable security interest in
all right, title and interest of the Credit Parties in the Trademark
Collateral described therein, and the Collateral Agent, for the
benefit of the Secured Creditors, has a fully perfected first lien
on, and security interest in, all right, title and interest in all of
the Trademark Collateral described therein, subject to no other Liens
other than Permitted Liens. The recordation of a Conditional
Assignment of Security Interest in U.S. Patents and Trademarks in the
form attached to each Trademark Security Agreement in the United
States Patent and Trademark Office together with filings on Form UCC-
1 made pursuant to each such Trademark Security Agreement will
create, as may be perfected by such filing and recordation, a
perfected security interest in the registered United States trade-
marks and patents covered by each such Trademark Security Agreement
and the recordation of a Conditional Assignment of Security Interest
in U.S. Copyrights in the form attached to each Trademark Security
Agreement with the United States Copyright Office together with fil-
ings on Form UCC-1 made pursuant to each such Trademark Security
Agreement will create, as may be perfected by such filing and
recordation, a perfected security interest in the registered United
States copyrights covered by each such Trademark Security Agreement.
(c) At all times prior to the Collateral Release Date, the
security interests created in favor of the Collateral Agent, as
secured party, for the benefit of the Secured Creditors, under each
of the Pledge Agreements constitute first priority perfected security
interests in the Pledged Collateral described therein, subject to no
security interests of any other Person. Assuming the continued
possession by the Collateral Agent of the Pledged Collateral
constituting certificates securities, no filings or recordings are
required in order to perfect (or maintain the perfection or priority
of) the security interests created in the Pledged Collateral under
the Pledge Agreements.
(d) At all times prior to the Collateral Release Date, the
Mortgages create, for the obligations purported to be secured
thereby, a valid and enforceable perfected security interest in and
mortgage lien on all of the Mortgaged Properties in favor of the
Collateral Agent (or such other trustee as may be required or desired
under local law) for the benefit of the Secured Creditors, superior
to and prior to the rights of all third persons (except that the
security interest and mortgage lien created in the Mortgaged
Properties may be subject to the Permitted Encumbrances related
thereto) and subject to no other Liens (other than Permitted Liens).
Schedule III contains a true and complete list of each parcel of Real
Property owned or leased by Holdings and its Subsidiaries on the
Effective Date, and the type of interest therein held by Holdings or
such Subsidiary.
7.12 Properties. Holdings and each of its Subsidiaries
have good and marketable title to all material properties owned by
them, free and clear of all Liens, other than Permitted Liens.
7.13 Representations and Warranties in the Documents. All
representations and warranties set forth in the other Documents were
true and correct in all material respects at the time as of which
such representations and warranties were made (or deemed made) and
shall be true and correct in all material respects as of the
Effective Date and as of the date of each Credit Event as if such
representations and warranties were made on and as of each such date,
unless stated to relate to a specific earlier date, in which case
such representations and warranties shall be true and correct in all
material respects as of such earlier date.
7.14 Patents, Licenses, Franchises and Formulas. Each of
Holdings and each of its Subsidiaries owns or has the right to use
all the patents, trademarks, permits, service marks, trade names,
copyrights, licenses, franchises, proprietary information (including
but not limited to rights in computer programs and databases) and
formulas, or rights with respect to the foregoing, and has obtained
assignments of all leases and other rights of whatever nature, neces-
sary for the present conduct of its business, without any known
conflict with the rights of others which, or the failure to obtain
which, as the case may be, could reasonably be expected to result in
a material adverse effect on the business, operations, property,
assets, liabilities or condition (financial or otherwise) of the
Borrower and the Guarantors taken as a whole.
7.15 Subsidiaries. As of the Effective Date, Holdings has
no Subsidiaries other than those Subsidiaries listed on Schedule IV.
Schedule IV correctly sets forth, as of the Effective Date, the
percentage ownership (direct or indirect) of Holdings in each class
of capital stock or other equity of each of its Subsidiaries and also
identifies the direct owner thereof.
7.16 Compliance with Statutes, etc. Each of Holdings and
each of its Subsidiaries is in compliance with all applicable
statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect
of the conduct of its business and the ownership of its property
(including applicable statutes, regulations, orders and restrictions
relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, rea-
sonably be expected to have a material adverse effect on the
business, operations, property, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Guarantors taken as
a whole.
7.17 Investment Company Act. Neither Holdings nor any of
its Subsidiaries is an "investment company" or a company "controlled"
by an "investment company," within the meaning of the Investment
Company Act of 1940, as amended.
7.18 Public Utility Holding Company Act. Neither Holdings
nor any of its Subsidiaries is a "holding company," or a "subsidiary
company" of a "holding company," or an "affiliate" of a "holding
company" or of a "subsidiary company" of a "holding company" within
the meaning of the Public Utility Holding Company Act of 1935, as
amended.
7.19 Environmental Matters. (a) Holdings and each of its
Subsidiaries have complied with, and on the date of each Credit Event
are in compliance with, all applicable Environmental Laws and the re-
quirements of any permits issued under such Environmental Laws.
There are no pending or, to the best knowledge of Holdings and the
Borrower, threatened Environmental Claims against Holdings or any of
its Subsidiaries (including any such claim arising out of the owner-
ship or operation by Holdings or any of its Subsidiaries of any Real
Property no longer owned or operated by Holdings or any of its Sub-
sidiaries) or any Real Property owned or operated by Holdings or any
of its Subsidiaries. There are no facts, circumstances, conditions
or occurrences with respect to the business or operations of Holdings
or any of its Subsidiaries, or any Real Property owned or operated by
Holdings or any of its Subsidiaries (including any Real Property
formerly owned or operated by Holdings or any of its Subsidiaries but
no longer owned or operated by Holdings or any of its Subsidiaries)
or any property adjoining or adjacent to any such Real Property that
could be expected (i) to form the basis of an Environmental Claim
against Holdings or any of its Subsidiaries or any Real Property
owned or operated by Holdings or any of its Subsidiaries or (ii) to
cause any Real Property owned or operated by Holdings or any of its
Subsidiaries to be subject to any restrictions on the ownership,
occupancy or transferability of such Real Property by Holdings or any
of its Subsidiaries under any applicable Environmental Law.
(b) Hazardous Materials have not at any time been
generated, used, treated or stored on, or transported to or from, any
Real Property owned or operated by Holdings or any of its Subsid-
iaries where such generation, use, treatment or storage has violated
or could be expected to violate any Environmental Law. Hazardous
Materials have not at any time been Released on or from any Real
Property owned or operated by Holdings or any of its Subsidiaries
where such Release has violated or could be expected to violate any
applicable Environmental Law.
(c) Notwithstanding anything to the contrary in this
Section 7.19 the representations made in this Section 7.19 shall not
be untrue unless the effect of all violations, claims, restrictions,
failures and noncompliances of the types described in this Section
7.19 could reasonably be expected to, individually or in the
aggregate, have a material adverse effect on the business,
operations, property, assets, liabilities or condition (financial or
otherwise) of the Borrower and the Guarantors taken as a whole.
7.20 Labor Relations. Neither Holdings nor any of its
Subsidiaries is engaged in any unfair labor practice that could
reasonably be expected to have a material adverse effect on the
Borrower and the Guarantors taken as a whole. There is (i) no unfair
labor practice complaint pending against Holdings or any of its Sub-
sidiaries or, to the knowledge of Holdings and the Borrower, threat-
ened against any of them, before the National Labor Relations Board,
and no grievance or arbitration proceeding arising out of or under
any collective bargaining agreement is so pending against Holdings or
any of its Subsidiaries or, to the best knowledge of Holdings and the
Borrower, threatened against any of them, (ii) no strike, labor
dispute, slowdown or stoppage is pending against Holdings or any of
its Subsidiaries or, to the best knowledge of Holdings and the
Borrower, threatened against Holdings or any of its Subsidiaries and
(iii) no union representation question exists with respect to the
employees of Holdings or any of its Subsidiaries, except (with
respect to any matter specified in clause (i), (ii) or (iii) above,
either individually or in the aggregate) such as could not reasonably
be expected to have a material adverse effect on the business,
operations, property, assets, liabilities or condition (financial or
otherwise) of the Borrower and the Guarantors taken as a whole.
7.21 Indebtedness. (a) Schedule V sets forth a true and
complete list of all Indebtedness (including Contingent Obligations)
of Holdings and its Subsidiaries as of the Effective Date and which
is to remain outstanding after giving effect to the Transaction
(excluding the Loans, the Letters of Credit, any Senior Subordinated
Notes and any Contingent Obligations in respect of the SL Documents,
the "Existing Indebtedness"), in each case showing the aggregate
principal amount thereof and the name of the respective borrower and
any Credit Party or any of its Subsidiaries which directly or
indirectly guarantees such debt.
(b) So long as any Senior Subordinated Notes remain
outstanding, the subordination provisions contained in the Senior
Subordinated Notes and in the other Senior Subordinated Note
Documents are enforceable against the Borrower, the respective
Subsidiary Guarantors and the holders of the Senior Subordinated
Notes, and all Obligations hereunder and under the Subsidiaries
Guaranty are within the definition of "Senior Indebtedness" or
"Guarantor Senior Indebtedness", as the case may be, included in such
subordination provisions.
SECTION 8. Affirmative Covenants. Each of Holdings and
the Borrower hereby covenants and agrees that on and after the
Effective Date and until the Total Revolving Loan Commitment and all
Letters of Credit have terminated and the Loans, Notes and Unpaid
Drawings, together with interest, Fees and all other Obligations
incurred hereunder and thereunder (other than indemnity and similar
obligations that are not then due and payable) are paid in full:
8.01 Information Covenants. Holdings will furnish to each
Bank:
(a) Quarterly Financial Statements. Concurrently with the
delivery thereof to the SEC, but in no event later than 60 days
after the close of the first three quarterly accounting periods
in each fiscal year of Holdings and within 105 days after the
close of the fourth quarterly accounting period in each such
fiscal year (commencing with the fourth fiscal quarter of fiscal
year 1997), (i) the consolidated balance sheet of Holdings and
its Subsidiaries as at the end of such quarterly accounting
period, (ii) the related consolidated statement of operations,
statement of stockholders' equity and statements of cash flows
of Holdings and its Subsidiaries for such quarterly accounting
period and for the elapsed portion of the fiscal year ended with
the last day of such quarterly accounting period and (iii) a
schedule containing a summary of sales and a summary of
comparable store sales growth, in each case for the Borrower and
its Subsidiaries on a consolidated basis, for such quarterly
accounting period and for the elapsed portion of the fiscal year
ended with the last day of such quarterly accounting period, in
each case in respect of preceding clauses (i), (ii) and (iii)
setting forth comparative figures for the related periods in the
prior fiscal year and comparable budgeted figures for such
period, as set forth in the respective and budget delivered
pursuant to Section 8.01(d), all of which shall be in reasonable
detail and shall be certified by the president, the chief
financial officer or the treasurer of Holdings to the effect
that such financial statements fairly present in all material
respects the financial condition of Holdings and its
Subsidiaries as at the date indicated and the results of their
operations and their cash flows for the period indicated,
subject to normal year-end audit adjustments and the absence of
footnotes.
(b) Annual Financial Statements. Concurrently with the
delivery thereof to the SEC, but in no event later than 105 days
after the close of each fiscal year of Holdings, (i) the consol-
idated balance sheet of Holdings and its Subsidiaries as at the
end of such fiscal year and the related consolidated statement
of operations, statement of stockholders' equity and statements
of cash flows of Holdings and its Subsidiaries for such fiscal
year setting forth comparative figures for the preceding fiscal
year and comparable budgeted figures for such fiscal year as set
forth in the respective budget delivered pursuant to Section
8.01(d) and certified by Ernst & Young LLP or such other
independent certified public accountants of recognized national
standing reasonably acceptable to the Agents, together with (A)
a report of such accounting firm which report shall be
unqualified as to scope of audit, shall express no doubts about
the ability of Holdings and its Subsidiaries to continue as a
going concern and shall state that such consolidated financial
statements fairly present the consolidated financial position of
Holdings and its Subsidiaries as at the dates indicated and the
results of their operations and cash flows for the periods
indicated in conformity with generally accepted accounting
principles applied on a basis consistent with prior years
(except as otherwise disclosed in such financial statements) and
the examination by such accountants in connection with such
consolidated financial statements has been made in accordance
with generally accepted auditing standards, (B) a written
statement by such accounting firm stating that (1) in the course
of its regular audit of the financial statements of Holdings and
its Subsidiaries such accounting firm obtained no knowledge of
any Default or an Event of Default relating to accounting
matters which has occurred and is continuing or, if in the opin-
ion of such accounting firm such a Default or Event of Default
has occurred and is continuing, a statement as to the nature and
period of existence thereof, provided that such accounting firm
shall not be liable by reason of any failure to obtain knowledge
of any such Default or Event of Default that would not be
disclosed in the course of their audit examination and (2) based
upon their audit examination nothing has come to their attention
that causes them to believe that the information contained in
the certificates delivered therewith pursuant to Section 8.01(e)
is not correct and (C) a letter from such accounting firm,
substantially in the form delivered to the lenders under the
Existing Credit Agreement with such changes thereto as are
approved by the Agents, acknowledging that the Banks will
receive such consolidated financial statements and such report
and will use such consolidated financial statements and such
report in their credit analyses of Holdings and its
Subsidiaries, and (ii) management's discussion and analysis of
the important operational and financial developments during such
fiscal year.
(c) Management Letters. Promptly after Holdings' or any
of its Subsidiaries' receipt thereof, a copy of any "management
letter" received from its certified public accountants and
management's response thereto (other than reports of a routine
or ministerial nature which are not material).
(d) Budgets. No later than 60 days following the first
day of each fiscal year of the Borrower, a budget in reasonable
detail (including budgeted statements of income and sources and
uses of cash and balance sheets) prepared by the Borrower for
such fiscal year and for each of the four quarterly accounting
periods of such fiscal year setting forth, with appropriate
discussion, the principal assumptions upon which such budgets
are based.
(e) Officer's Certificates. At the time of the delivery
of the financial statements provided for in Sections 8.01(a) and
(b), a certificate of the president, the chief financial officer
or the treasurer of Holdings to the effect that, to the best of
such officer's knowledge, no Default or Event of Default has
occurred and is continuing or, if any Default or Event of
Default has occurred and is continuing, specifying the nature
and extent thereof, which certificate shall set forth (i) in
reasonable detail the calculations required to establish whether
Holdings and its Subsidiaries were in compliance with the
provisions of Sections 9.03, 9.04 and 9.07 through 9.10, inclu-
sive, at the end of such fiscal quarter or year, as the case may
be, (ii) the Applicable Eurodollar Rate Margin and the
Applicable Commitment Commission Percentage for the Margin
Reduction Period commencing with the date of the delivery of
such financial statements and (iii) notice of the acquisition or
sale or other disposition of any Store Land Property during the
fiscal period covered by such financial statements, which notice
shall include the purchase price or sale price of each such
Store Land Property, as applicable.
(f) Notice of Default or Litigation. Promptly upon, and
in any event within three Business Days after, an officer of any
Credit Party (other than a Land Trust) obtains knowledge
thereof, notice of (i) the occurrence of any event which con-
stitutes a Default or an Event of Default and/or (ii) any liti-
gation or governmental investigation or proceeding (or any
material development thereof in the case of any litigation or
governmental proceeding previously reported or disclosed) pend-
ing (x) against Holdings or any of its Subsidiaries which could
reasonably be expected to materially and adversely affect the
business, operations, property, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Guarantors
taken as a whole, or (y) with respect to the Transaction or any
Document.
(g) Other Reports and Filings. Promptly after the filing
or delivery thereof, copies of (i) all financial statements,
reports, notices and proxy statements sent or made available
generally by Holdings or the Borrower to its security holders or
by any Subsidiary of the Borrower to its security holders other
than Holdings or any of its Subsidiaries, (ii) all regular and
periodic reports and all registration statements (other than on
Form S-8 or similar form) and prospectuses, if any (other than
reports of a routine or ministerial nature which are not
material), filed by Holdings or any of its Subsidiaries with the
Securities and Exchange Commission or any successor thereto (the
"SEC") and (iii) all press releases and other statements made
available generally by Holdings or any of its Subsidiaries to
the public concerning material developments in the business of
Holdings or any of its Subsidiaries.
(h) Environmental Matters. Promptly after any officer of
any Credit Party obtains knowledge thereof, notice of one or
more of the following environmental matters, unless such
environmental matters could not, individually or when aggregated
with all other such environmental matters, be reasonably ex-
pected to materially and adversely affect the business, opera-
tions, property, assets, liabilities or condition (financial or
otherwise) of the Borrower and the Guarantors taken as a whole:
(i) any pending or threatened Environmental Claim
against Holdings or any of its Subsidiaries or any Real
Property owned or operated by Holdings or any of its Sub-
sidiaries;
(ii) any condition or occurrence on or arising from
any Real Property owned or operated by Holdings or any of
its Subsidiaries that (a) results in noncompliance by
Holdings or any of its Subsidiaries with any applicable
Environmental Law or (b) could be expected to form the
basis of an Environmental Claim against Holdings or any of
its Subsidiaries or any such Real Property;
(iii) any condition or occurrence on any Real Property
owned or operated by Holdings or any of its Subsidiaries
that could be expected to cause such Real Property to be
subject to any restrictions on the ownership, occupancy,
use or transferability by Holdings or any of its
Subsidiaries of such Real Property under any Environmental
Law; and
(iv) the taking of any removal or remedial action in
response to the actual or alleged presence of any
Hazardous Material on any Real Property owned or operated
by Holdings or any of its Subsidiaries as required by any
Environmental Law or any governmental or other administra-
tive agency; provided, that in any event Holdings shall
deliver to each Bank all notices received by Holdings or
any of its Subsidiaries from any government or
governmental agency under, or pursuant to, CERCLA which
identify Holdings or any of its Subsidiaries as poten-
tially responsible parties for remediation costs or which
otherwise notify Holdings or any of its Subsidiaries of
potential liability under CERCLA.
All such notices shall describe in reasonable detail the
nature of the claim, investigation, condition, occurrence or
removal or remedial action and Holdings' or such Subsidiary's
response thereto.
(i) Annual Meetings with Banks. At dates to be mutually
agreed upon among the Agents and Holdings, Holdings shall, at
the request of the Agents, hold an annual meeting with all of
the Banks at which meeting shall be reviewed the financial
results of Holdings and its Subsidiaries for the previous fiscal
year and the budgets presented for the current fiscal year of
Holdings.
(j) SL Documents. No later than five Business Days after
entering into any amendment or modification to any SL Document,
a copy thereof to the Agents (it being understood and agreed
that nothing in this Section 8.01(j) shall be deemed to permit
any amendment or modification to any SL Document otherwise
prohibited under Section 9.11) and, promptly upon receipt
thereof, a copy to the Agents and the Banks of any notice of
default, any notice of event of default or any similar notice
received by any Credit Party under any of the SL Documents.
(k) Board of Directors. With reasonable promptness,
written notice of any change in the Board of Directors of
Holdings or the Borrower.
(l) Other Information. From time to time, such other
information or documents (financial or otherwise) with respect
to Holdings or any of its Subsidiaries as any Agent or any Bank
may reasonably request.
8.02 Books, Records and Inspections. Holdings will, and
will cause each of its Subsidiaries to, keep proper books of record
and accounts in conformity with generally accepted accounting prin-
ciples and all requirements of law in relation to its business and
activities. Holdings will, and will cause each of its Subsidiaries
to, permit officers and designated representatives of any Agent or
any Bank to visit and inspect, under guidance of officers or other
representatives of Holdings or such Subsidiary, any of the properties
of Holdings or such Subsidiary, and to examine the books of account
of Holdings or such Subsidiary and discuss the affairs, finances and
accounts of Holdings or such Subsidiary with, and be advised as to
the same by, its and their officers and, in conjunction with Holdings
or the Borrower, their independent accountants, all at such
reasonable times and intervals and to such reasonable extent as any
Agent or such Bank may reasonably request.
8.03 Maintenance of Property; Insurance. Holdings will,
and will cause each of its Subsidiaries to, (i) keep all property
necessary to the business of Holdings and its Subsidiaries in
reasonably good working order and condition, ordinary wear and tear
excepted, (ii) maintain insurance in at least such amounts and
against at least such risks as is consistent and in accordance with
industry practice for companies similarly situated owning similar
properties in the same general areas in which Holdings or any of its
Subsidiaries operates, it being understood and agreed that, in any
event, all insurance relating to the Collateral also shall comply
with the insurance provisions of the respective Security Documents,
and (iii) furnish to any Agent or any Bank, upon written request,
full information as to the insurance carried.
(b) If Holdings or any of its Subsidiaries shall fail
to maintain insurance in accordance with this Section 8.03, the
Collateral Agent shall have the right (but shall be under no
obligation) to procure such insurance and Holdings and the Borrower
agree to reimburse the Collateral Agent for all costs and expenses of
procuring such insurance.
8.04 Corporate Franchises. Holdings will, and will cause
each of its Subsidiaries to, do or cause to be done, all things
necessary to preserve and keep in full force and effect its existence
and its rights, franchises, licenses and patents, except for such
rights, franchises, licenses and patents the failure of which to
maintain could not reasonably be expected to have a material adverse
effect on the business, operations, property, assets, liabilities or
condition (financial or otherwise) of the Borrower and the Guarantors
taken as a whole; provided, however, that nothing in this Section
8.04 shall prevent (i) sales of assets and other transactions by
Holdings or any of its Subsidiaries in accordance with Section 9.02
or (ii) the withdrawal by Holdings or any of its Subsidiaries of its
qualification as a foreign corporation in any jurisdiction where such
withdrawal could not reasonably be expected to have a material
adverse effect on the business, operations, property, assets,
liabilities or condition (financial or otherwise) of the Borrower and
the Guarantors taken as a whole.
8.05 Compliance with Statutes, etc. Holdings will, and
will cause each of its Subsidiaries to, comply with all applicable
statutes, regulations and orders of, and all applicable restrictions
imposed by, all governmental bodies, domestic or foreign, in respect
of the conduct of its business and the ownership of its property
(including applicable statutes, regulations, orders and restrictions
relating to environmental standards and controls), except such
noncompliances as could not, individually or in the aggregate, rea-
sonably be expected to have a material adverse effect on the busi-
ness, operations, property, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Guarantors taken as
a whole.
8.06 Compliance with Environmental Laws. (a) Holdings
will, and will cause each of its Subsidiaries to, comply in all
respects with all Environmental Laws applicable to the ownership or
use of its Real Property now or hereafter owned or operated by
Holdings or any of its Subsidiaries, will promptly pay or cause to be
paid all costs and expenses incurred in connection with such compli-
ance, and will keep or cause to be kept all such Real Property free
and clear of any Liens imposed pursuant to such Environmental Laws.
Neither Holdings nor any of its Subsidiaries will generate, use,
treat, store, Release or dispose of, or permit the generation, use,
treatment, storage, Release or disposal of Hazardous Materials on any
Real Property now or hereafter owned or operated by Holdings or any
of its Subsidiaries, or transport or permit the transportation of
Hazardous Materials to or from any such Real Property, except for
Hazardous Materials generated, used, treated, stored, Released or
disposed of at any such Real Properties in compliance in all respects
with all applicable Environmental Laws and reasonably required in
connection with the operation, use and maintenance of the business or
operations of Holdings or any of its Subsidiaries. Notwithstanding
anything to the contrary contained above in this Section 8.06(a), no
default in the due performance or observance of any covenant
contained in this Section 8.06(a) shall occur unless the effect of
all violations, claims, restrictions, failures and noncompliances of
the types described above could reasonably be expected to,
individually or in the aggregate, have a material adverse effect on
the business, operations, property, assets, liabilities or condition
(financial or otherwise) of the Borrower and the Guarantors taken as
a whole.
(b) At the reasonable written request of the Agents or
the Required Banks, which request shall specify in reasonable detail
the basis therefor, at any time and from time to time, Holdings will
provide, at the sole expense of Holdings and the Borrower, an
environmental site assessment report concerning any Real Property
owned or operated by Holdings or any of its Subsidiaries, prepared by
an environmental consulting firm reasonably approved by the Agents,
indicating the presence or absence of Hazardous Materials and the
potential cost of any removal or remedial action in connection with
such Hazardous Materials on such Real Property, provided that (i)
unless the Banks or the Agents have received any notice of the type
described in Section 8.01(h) or (ii) the Banks have exercised any of
the remedies pursuant to the last paragraph of Section 10, such
request may not be made more than once every two years in respect of
any parcel of Real Property. If Holdings fails to provide the same
within 90 days after such request was made, the Agents may order the
same, the cost of which shall be borne by Holdings and the Borrower,
and Holdings and the Borrower shall grant and hereby grant to the
Agents and the Banks and their agents access to such Real Property
and specifically grants the Agents and the Banks an irrevocable non-
exclusive license, subject to the rights of tenants, to undertake
such an assessment at any reasonable time upon reasonable notice to
Holdings, all at the sole and reasonable expense of Holdings and the
Borrower.
8.07 ERISA. As soon as possible and, in any event,
within ten (10) days after Holdings, any Subsidiary of Holdings or
any ERISA Affiliate knows or has reason to know of the occurrence of
any of the following, to the extent that the same could reasonably be
expected to, individually or in the aggregate, have a material
adverse effect on the business, operations, property, assets,
liabilities or condition (financial or otherwise) of the Borrower and
the Guarantors taken as a whole, Holdings will deliver to each of the
Banks a certificate of the chief financial officer of Holdings
setting forth the full details as to such occurrence and the action,
if any, that Holdings, such Subsidiary or such ERISA Affiliate is
required or proposes to take, together with any notices required or
proposed to be given to or filed with or by Holdings, the Subsidiary,
the ERISA Affiliate, the PBGC, a Plan participant or the Plan
administrator with respect thereto: that a Reportable Event has
occurred (except to the extent that Holdings has previously delivered
to the Banks a certificate and notices (if any) concerning such event
pursuant to the next clause hereof); that a contributing sponsor (as
defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title
IV of ERISA is subject to the advance reporting requirement of PBGC
Regulation Section 4043.61 (without regard to subparagraph (b)(1)
thereof), and an event described in subsection .62, .63, .64, .65,
.66, .67 or .68 of PBGC Regulation Section 4043 is reasonably
expected to occur with respect to such Plan within the following 30
days; that an accumulated funding deficiency, within the meaning of
Section 412 of the Code or Section 302 of ERISA, has been incurred or
an application may be or has been made for a waiver or modification
of the minimum funding standard (including any required installment
payments) or an extension of any amortization period under Section
412 of the Code or Section 303 or 304 of ERISA with respect to a
Plan; that any contribution required to be made with respect to a
Plan has not been timely made; that a Plan has been or may be termi-
nated, reorganized, partitioned or declared insolvent under Title IV
of ERISA; that a Plan has an Unfunded Current Liability; that
proceedings may be or have been instituted to terminate or appoint a
trustee to administer a Plan which is subject to Title IV of ERISA;
that a proceeding has been instituted pursuant to Section 515 of
ERISA to collect a delinquent contribution to a Plan; that Holdings,
any Subsidiary of Holdings or any ERISA Affiliate will or may
reasonably be expected to incur any liability (including any
indirect, contingent, or secondary liability) to or on account of the
termination of or withdrawal from a Plan under Section 4062, 4063,
4064, 4069, 4201, 4204 or 4212 of ERISA or with respect to a Plan
under Section 401(a)(29), 4971, 4975 or 4980 of the Code or Section
409 or 502(i) or 502(l) of ERISA or with respect to a group health
plan (as defined in Section 607(1) of ERISA or Section 4980B(g)(2) of
the Code) under Section 4980B of the Code; or that Holdings or any
Subsidiary of Holdings may reasonably be expected to incur any
liability pursuant to any employee welfare benefit plan (as defined
in Section 3(1) of ERISA) that provides benefits to retired employees
or other former employees (other than as required by Section 601 of
ERISA) or any Plan. Upon the request of any Agent, Holdings will
deliver to each of the Banks a complete copy of the annual report (on
Internal Revenue Service Form 5500-series) of each Plan (including,
to the extent required, the related financial and actuarial
statements and opinions and other supporting statements,
certifications, schedules and information) required to be filed with
the Internal Revenue Service. In addition to any certificates or
notices delivered to the Banks pursuant to the first sentence hereof,
copies of any records, documents or other information that must be
furnished to the PBGC with respect to any Plan pursuant to Section
4010 of ERISA, and any material notices received by Holdings, any
Subsidiary of Holdings or any ERISA Affiliate with respect to any
Plan shall be delivered to the Banks no later than ten (10) days
after the date such records, documents and/or information has been
furnished to the PBGC or such notice has been received by Holdings,
the Subsidiary or the ERISA Affiliate, as applicable.
8.08 End of Fiscal Years; Fiscal Quarters. Holdings will
cause (i) each of its, and each of its Subsidiaries, fiscal years to
end on the Saturday closest to October 31 of each fiscal year, and
(ii) each of its, and each of its Subsidiaries, fiscal quarters to
consist of, in the case of the first two fiscal quarters of each
fiscal year, a 12-week period, in the case of the third fiscal
quarter of each fiscal year, a 16-week period and, in the case of the
fourth fiscal quarter of each fiscal year, a 12-week or 13-week
period.
8.09 Performance of Obligations. Holdings will, and will
cause each of its Subsidiaries to, perform all of its obligations
under the terms of each mortgage, indenture, security agreement, loan
agreement or credit agreement and each other material agreement,
contract or instrument by which it is bound, except such non-perfor-
mances as could not, individually or in the aggregate, reasonably be
expected to have a material adverse effect on the business,
operations, property, assets, liabilities or condition (financial or
otherwise) of the Borrower and the Guarantors taken as a whole.
8.10 Payment of Taxes. Holdings will pay and discharge,
and will cause each of its Subsidiaries to pay and discharge, all
material taxes, assessments and governmental charges or levies
imposed upon it or upon its income or profits, or upon any material
properties belonging to it, prior to the date on which any material
penalties attach thereto, and all lawful claims for sums that have
become due and payable which, if unpaid, might become a Lien not
otherwise permitted under Section 9.01(i); provided, that neither
Holdings nor any of its Subsidiaries shall be required to pay any
such tax, assessment, charge, levy or claim which is being contested
in good faith and by proper proceedings if it has maintained adequate
reserves with respect thereto in accordance with generally accepted
accounting principles.
8.11 Margin Stock. Holdings will, and will cause each of
the Subsidiary Guarantors to, take any and all actions as may be
required to ensure that no capital stock pledged, or required to be
pledged, pursuant to the Pledge Agreements shall constitute Margin
Stock.
8.12 Execution of Subsidiaries Guaranty and Security
Documents by Future Subsidiaries. In the event that any Person
becomes a Subsidiary (other than an Immaterial Subsidiary (but only
so long as such Person remains an Immaterial Subsidiary)) of Holdings
after the date hereof, the Borrower will promptly notify the
Administrative Agent of that fact and cause such Subsidiary to
execute and deliver to the Administrative Agent a counterpart of the
Subsidiaries Guaranty and, if such Person became or becomes a
Subsidiary (other than an Immaterial Subsidiary (but only so long as
such Person remains an Immaterial Subsidiary)) of Holdings before the
Collateral Release Date, cause (i) such Subsidiary to execute and
deliver to the Administrative Agent a counterpart of the Subsidiary
Security Agreement, the Subsidiary Pledge Agreement, the Subsidiary
Trademark Security Agreement and Mortgages and to take all such
further action and execute all such further documents and instruments
as may be required to grant and perfect in favor of the Collateral
Agent, for the benefit of the Secured Creditors, a first-priority
security interest in all of the real, personal and mixed property
assets of such Subsidiary (other than with respect to Excluded
Properties, and other than any such assets which are subject to Liens
permitted under Section 9.01 and other than Real Property that such
Subsidiary would not be obligated to pledge to the Collateral Agent
pursuant to Section 8.13 (it being understood and agreed that all of
the requirements of Section 8.13 are applicable to the Real Property
of such Subsidiary, with the date such Subsidiary became a Subsidiary
(other than an Immaterial Subsidiary) of Holdings or ceased to
constitute an Immaterial Subsidiary being treated for purposes of
Section 8.13 as the date on which such Subsidiary acquired all of its
Real Property)) and (ii) the parent of such Subsidiary (including any
Immaterial Subsidiary) to effect the pledge by such parent to the
Collateral Agent on behalf of the Secured Creditors of all of the
capital stock of such Subsidiary (including, without limitation, by
executing and delivering to the Collateral Agent a counterpart of the
Subsidiary Pledge Agreement or an amendment to the Pledge Agreement
previously executed by such parent). The Borrower shall deliver to
the Administrative Agent, together with such counterparts of the
Subsidiaries Guaranty and/or such Security Documents (to the extent
required to be so delivered), (v) certified copies of such
Subsidiary's Articles or Certificate of Incorporation, together with
a good standing certificate from the Secretary of State of the
jurisdiction of its incorporation, each to be dated a recent date
prior to their delivery to the Administrative Agent, (w) a copy of
such Subsidiary's Bylaws, certified by its corporate secretary or an
assistant corporate secretary as of a recent date prior to their
delivery to the Administrative Agent, (x) a certificate executed by
the secretary or an assistant secretary of such Subsidiary as to (i)
the incumbency and signatures of the officers of such Subsidiary
executing the Subsidiaries Guaranty and, if such Person became or
becomes a Subsidiary of Holdings before the Collateral Release Date,
the Security Documents to which such Subsidiary is a party and (ii)
the fact that the attached resolutions of the Board of Directors of
such Subsidiary authorizing the execution, delivery and performance
of the Subsidiaries Guaranty and, if such Person became or becomes a
Subsidiary of Holdings before the Collateral Release Date, such
Security Documents are in full force and effect and have not been
modified or rescinded, (y) if such Person became or becomes a
Subsidiary of Holdings before the Collateral Release Date, the
certificate or certificates evidencing all of the capital stock of
such Subsidiary, and (z) a favorable opinion of counsel to the
Borrower and such Subsidiary, in form and substance reasonably
satisfactory to the Agents, as to (i) the due organization and good
standing of such Subsidiary, (ii) the due authorization, execution
and delivery by such Subsidiary of the Subsidiaries Guaranty and, if
such Person became or becomes a Subsidiary of Holdings before the
Collateral Release Date, such Security Documents, (iii) the
enforceability of the Subsidiaries Guaranty and, if such Person
became or becomes a Subsidiary of Holdings before the Collateral
Release Date, such Security Documents against such Subsidiary, and
(iv) such other matters as any Agent may reasonably request, all of
the foregoing to be reasonably satisfactory in form and substance to
the Agents.
8.13 Additional Real Property. After the Effective Date,
each of Holdings and the Borrower shall, and shall cause each of its
respective Subsidiaries (other than an Immaterial Subsidiary (but
only so long as such Person remains an Immaterial Subsidiary)) to:
(a) with respect to each leasehold interest in Real
Property hereafter acquired by such Person prior to the Collateral
Release Date (whether directly or through a land trust or other
vehicle) (the holder of such leasehold interest being referred to
herein as the "Lessee"), use its reasonable efforts (which shall not
be deemed to include the payment of monetary consideration other than
nominal monetary consideration and out-of-pocket expenses incurred by
any lessor in connection with obtaining the items listed below, but
shall include efforts to include each of the items listed below in
the terms of the lease itself) to obtain and deliver to the
Administrative Agent within three months after such Real Property is
designated by the Borrower prior to Collateral Release Date as
Replacement Property:
(i) the agreement of the lessor (if required under the
lease) to the encumbrancing of such Lessee's leasehold interest
under the lease pursuant to a Mortgage and to the assignment of
such leasehold interest to the Collateral Agent following a
default hereunder, and if the lease allows the lessor to
unreasonably withhold consent to an assignment of the leasehold
interest by the Collateral Agent to a subsequent third party
assignee, the agreement of the lessor not to unreasonably
withhold such consent; and
(ii) an original memorandum of the lease executed and
acknowledged by the lessor thereunder (or, in the case of an
existing leasehold interest which is of record and which is
acquired by the Lessee by assignment, a memorandum of or a
recordable duplicate original of such assignment, executed and
acknowledged by the assigning Lessee), in form sufficient to
give constructive notice (when recorded) of the Lessee's
leasehold interest under the lease to third-party purchasers and
encumbrancers of the affected real property and otherwise in
form reasonably satisfactory to the Agents, together with
evidence of its recordation in all places necessary or
desirable, in the reasonable judgment of the Agents, to give
constructive notice of the Lessee's leasehold interest to third
parties; and
(b) with respect to each leasehold interest in Real
Property listed in Parts I and II of Schedule III (to the extent the
items listed below in this clause (b) have not been obtained or
delivered to the Administrative Agent on the Effective Date) and each
parcel of Real Property in which Holdings or any of its Subsidiaries
acquires fee title or a leasehold interest after the Effective Date
but before the Collateral Release Date (in each case other than
Excluded Properties, parcels number 4 and 5 of location number 851,
leasehold interests as to which encumbrancing requires the consent of
the lessor or fee interests listed on Schedule III as to which
encumbrancing requires the consent of a senior lienholder, where
Holdings and its Subsidiaries have been unable to obtain the
applicable lessor's or senior lienholder's consent thereto, and
assets subject to Liens permitted under subsection 9.01(vii) and
(xiv)) (collectively, "Covered Real Property"), as soon as
practicable and in any event within one month after the applicable
Real Property becomes Covered Real Property (it being understood that
any Real Property which is (i) designated by the Borrower as a
Replacement Property (to the extent it was not already Covered Real
Property) shall become Covered Real Property as of the date of such
designation and (ii) an Excluded Property shall become Covered Real
Property as of the date of the occurrence of a Default or an Event of
Default), deliver:
(i) fully executed counterparts of a Mortgage, or an
amendment to a Mortgage, in form reasonably satisfactory to the
Agents, which Mortgage or amendment shall encumber such Covered
Real Property, together with evidence that counterparts of such
Mortgage or amendment have been recorded in all places to the
extent necessary or desirable, in the reasonable judgment of the
Agents, so as to effectively create a valid and enforceable
first priority lien (subject only to Permitted Liens) on such
Covered Real Property in favor of the Collateral Agent (or such
other trustee as may be required or desired under local law) for
the benefit of the Secured Creditors;
(ii) in the case of a Mortgage encumbering Covered Real
Property located outside the State of Illinois, if requested by
any Agent, an opinion of counsel (which counsel shall be
reasonably satisfactory to the Agents) in the State in which
such Covered Real Property is located with respect to the
enforceability of the Mortgage recorded in such State and such
other matters as any Agent may reasonably request, in form and
substance reasonably satisfactory to the Agents;
(iii) in the case of each such Covered Real Property
consisting of a leasehold interest, a copy of the lease
(including all amendments thereto), together with such consents
and agreements from the lessor on such real property as were
obtained pursuant to clause (a) above;
(iv) with respect to Real Property constituting fee
property, environmental audits prepared by professional
consultants mutually acceptable to the Borrower and the Agents,
in form, scope and substance reasonably satisfactory to the
Agents; and
(v) with respect to Real Property constituting fee
property, if requested by any Agent, a Title Insurance Policy,
in an amount reasonably satisfactory to the Agents, with respect
to the Collateral Agent's lien thereon.
The Borrower will, and will cause each of its Subsidiaries to,
permit any authorized representatives designated by any Agent to
visit and inspect any Real Property owned or leased (as a lessee) by
any Credit Party for the purpose of obtaining an appraisal of value,
conducted by consultants retained such Agent in compliance with all
applicable banking regulations; provided, however, that Holdings and
the Borrower shall be obligated to pay for all actual costs and
reasonable expenses of obtaining and reviewing any appraisal provided
for under this Section 8.13 for not more than one appraisal each year
for each such parcel of Real Property.
8.14 Designation of Replacement Properties. If, on any
date after the Effective Date and prior to the Collateral Release
Date, the Collateral Agent no longer has a Lien on any Real Property
owned or leased (as a lessee) by any Credit Party (each, a "Replaced
Property") which the Collateral Agent had prior to such date (whether
due to an Asset Sale relating to such Real Property, due to a
termination of lease relating to such Real Property or otherwise),
then the Borrower shall designate on or before such date Real
Property owned or leased (as a lessee) by any Credit Party (other
than any Real Property owned or leased (as a lessee) by any Credit
Party existing as of the Effective Date) which is not subject to any
Liens as a "Replacement Property" for such Replaced Property;
provided, however, that the Borrower shall not be required to
designate any Replacement Property with respect to the Real Property
listed on Part IV of Schedule III; provided, further, that the
Borrower shall not be required to designate any Replacement Property
for any Replaced Property to the extent the Net Cash Proceeds of the
Asset Sale relating to such Replaced Property are actually applied to
permanently reduce the Total Revolving Loan Commitment pursuant to
Section 3.03(b). If the Replaced Property is a leasehold interest in
a grocery store, then the Replacement Property for such Replaced
Property shall be a leasehold interest in a grocery store and shall
have annual sales that are equal to or greater than the Replaced
Property. If the Replaced Property is a fee interest, then the
Replacement Property for such Replaced Property shall be a fee
interest and shall have a fair market value (as determined in good
faith by the chief financial officer of the Borrower and evidenced by
a certificate of such officer of the Borrower certifying as to the
fair market value thereof) that is equal to or greater than the fair
market value (also as determined in the same manner) of the Replaced
Property; provided, that if such Replacement Property has a fair
market value greater than the fair market value of the Replaced
Property, then such excess fair market value (a) may be applied as
fair market value of Replacement Property for another parcel of Real
Property which concurrently becomes a Replaced Property or (b) shall
be reserved and may be applied as fair market value of Replacement
Property for any Real Property which subsequently becomes a Replaced
Property. If the Replaced Property is a leasehold interest in Real
Property which is not a grocery store, then the Replacement Property
for such Replaced Property shall be Real Property which has a
collateral value (as determined in good faith by chief financial
officer of the Borrower and evidenced by a certificate of such
officer of the Borrower certifying as to the collateral value
thereof) that is greater than or equal to the collateral value (also
as determined in the same manner) of such Replaced Property.
Concurrently with the designation of any Replacement Property, the
Borrower shall deliver to the Administrative Agent a certificate of
its chief financial officer (i) setting forth all such information as
the Agents may reasonably request with respect to such Replacement
Property and the related Replaced Property (including without
limitation the fair market value thereof (if a fee interest) and
annual sales figures with respect thereto (if a leasehold interest in
a grocery store)), (ii) certifying that the Replacement Property
complies with each of the requirements set forth in this Section
8.14, and (iii) setting forth a summary report of all Replacement
Properties therefore designated by the Borrower and the related
Replaced Properties (including without limitation the aggregate fair
market value thereof (if fee interests) and aggregate annual sales
figures with respect thereto (if leasehold interests in grocery
stores)).
8.15 Release of Collateral. If, as of the first Business
Day of any fiscal quarter of the Borrower, (i) the actual or implied
rating established and publicly announced or provided in a private
letter from the Rating Agencies or published by at least two of the
Rating Agencies with respect to senior, unsecured, non-credit
enhanced long term debt of the Borrower is BBB- or Baa3, as
applicable, or higher as of such date and the actual or implied
rating established and publicly announced or provided in a private
letter from the Rating Agencies or published by the same two Rating
Agencies with respect to senior, unsecured, non-credit enhanced long
term debt of the Borrower has continuously been BBB- or Baa3, as
applicable, or higher during the two consecutive fiscal quarters of
the Borrower immediately preceding such date, (ii) the Borrower is
not and shall not have been on credit watch with negative
implications by either of the same two Rating Agencies and (iii) no
Default or Event of Default has occurred and is continuing (the
conditions set forth in clauses (i), (ii) and (iii) above being
referred to herein as the "Collateral Release Conditions"), then the
Borrower may on such date request that the Collateral Agent execute
and deliver to the Borrower reconveyance documents and releases
(including, without limitation, UCC termination statements) releasing
all Liens on the Collateral that were granted in favor of the
Collateral Agent pursuant to the Security Documents. The Borrower
shall make such request in writing and shall concurrently deliver to
the Collateral Agent evidence in form and substance satisfactory to
the Collateral Agent showing that the Collateral Release Conditions
set forth in clauses (i) and (ii) above have been satisfied and a
certificate of the chief financial officer of the Borrower to the
effect that each of the Collateral Release Conditions has been
satisfied as of such date and that no Default or Event of Default has
occurred and is continuing or will be caused by such release of
Collateral. The date on which each Collateral Release Condition has
been satisfied and on which each such delivery has been made is
referred to herein as the "Collateral Release Date". Upon receiving
such request, the Collateral Agent shall, at the Borrower's expense,
promptly execute and deliver to the Borrower such reconveyance
documents and releases in recordable form, and deliver to the
Borrower, against receipt and without recourse to the Collateral
Agent, such of the Collateral (including, without limitation, stock
certificates (together with stock powers that were delivered to the
Collateral Agent by the Credit Parties) and promissory notes pledged
by the Credit Parties pursuant to the Pledge Agreements) as shall not
have been sold or applied pursuant to the terms of the Security
Agreements; provided that, at the time of the Collateral Agent's
execution and delivery of such reconveyance documents and releases
and delivery of such Collateral, no Default or Event of Default shall
have occurred and be continuing or shall be caused by such release of
Collateral; provided, further, that the Collateral Agent shall have
no obligation to release any Collateral pursuant to this Section 8.15
unless all Liens on such Collateral granted pursuant to the SL
Documents are released concurrently therewith.
8.16 Further Assurances. Holdings will, and will cause
each of its Subsidiaries to, at the expense of Holdings and the
Borrower, make, execute, endorse, acknowledge, record, file and/or
deliver to the Collateral Agent from time to time such vouchers,
invoices, schedules, confirmatory assignments, conveyances, financing
statements, transfer endorsements, powers of attorney, certificates,
real property surveys on new fee owned Mortgaged Properties, reports
and other assurances, instruments or documents and take such further
steps as may be necessary or desirable to establish, perfect,
preserve and protect the Liens relating to the Collateral covered by
any of the Security Documents as the Collateral Agent may reasonably
require.
8.17 Maintenance of Corporate Separateness. Holdings
will, and will cause each of its Subsidiaries and Unrestricted
Subsidiaries to, satisfy customary corporate formalities, including
the holding of regular board of directors' and shareholders' meetings
or action by directors or shareholders without a meeting and the
maintenance of corporate offices and records. Neither Holdings nor
any of its Subsidiaries shall make any payment to a creditor of any
Unrestricted Subsidiaries in respect of any liability of any
Unrestricted Subsidiaries, and no bank account of any Unrestricted
Subsidiary shall be commingled with any bank account of Holdings of
any of its Subsidiaries. Any financial statements distributed to any
creditors of any Unrestricted Subsidiaries shall clearly establish or
indicate the corporate separateness of such Unrestricted Subsidiary
from Holdings and its Subsidiaries. Finally, neither Holdings nor
any of its Subsidiaries shall take any action, or conduct its affairs
in a manner, which is likely to result in the corporate existence of
Holdings or any of its Subsidiaries or Unrestricted Subsidiaries
being ignored, or in the assets and liabilities of Holdings or any of
its Subsidiaries being substantively consolidated with those of any
other such Person or any Unrestricted Subsidiary in a bankruptcy,
reorganization or other insolvency proceeding.
SECTION 9. Negative Covenants. Each of Holdings and the
Borrower hereby covenants and agrees that on and after the Effective
Date and until the Total Revolving Loan Commitment and all Letters of
Credit have terminated and the Loans, Notes and Unpaid Drawings,
together with interest, Fees and all other Obligations incurred here-
under and thereunder (other than indemnity and similar obligations
that are not then due and payable), are paid in full:
9.01 Liens. Holdings will not, and will not permit any
of its Subsidiaries to, create, incur, assume or suffer to exist any
Lien upon or with respect to any property or assets (real or
personal, tangible or intangible) of Holdings or any of its
Subsidiaries, whether now owned or hereafter acquired, or sell any
such property or assets subject to an understanding or agreement,
contingent or otherwise, to repurchase such property or assets (in-
cluding sales of accounts receivable with recourse to Holdings or any
of its Subsidiaries), or assign any right to receive income or permit
the filing of any financing statement under the UCC or any other
similar notice of Lien under any similar recording or notice statute;
provided that the provisions of this Section 9.01 shall not prevent
the creation, incurrence, assumption or existence of the following
(Liens described below are herein referred to as "Permitted Liens"):
(i) Liens for taxes, assessments or governmental charges
or levies not yet due or Liens for taxes, assessments or
governmental charges or levies being contested in good faith and
by appropriate proceedings for which adequate reserves have been
established in accordance with generally accepted accounting
principles;
(ii) Liens in respect of property or assets of the
Borrower or any of its Subsidiaries imposed by law, which were
incurred in the ordinary course of business and do not secure
Indebtedness for borrowed money, such as carriers', ware-
housemen's, materialmen's and mechanics' liens and other similar
Liens arising in the ordinary course of business, and (x) which
do not in the aggregate materially detract from the value of the
Borrower's or such Subsidiary's property or assets or materially
impair the use thereof in the operation of the business of the
Borrower or such Subsidiary or (y) which are being contested in
good faith by appropriate proceedings, which proceedings have
the effect of preventing the forfeiture or sale of the property
or assets subject to any such Lien;
(iii) Liens in existence on the Effective Date which are
listed, and the property subject thereto described, in Schedule
VI, but only to the respective date, if any, set forth in such
Schedule VI for the removal, replacement and termination of any
such Liens, plus renewals, replacements and extensions of such
Liens, provided that (x) the aggregate principal amount of the
Indebtedness, if any, secured by such Liens does not increase
from that amount outstanding at the time of any such renewal,
replacement or extension and (y) any such renewal, replacement
or extension does not encumber any additional assets or proper-
ties of Holdings or any of its Subsidiaries;
(iv) Liens created pursuant to the Security Documents;
(v) leases or subleases granted to other Persons not
materially interfering with the conduct of the business of
Holdings and its Subsidiaries taken as a whole;
(vi) Liens upon assets of the Borrower or any of its Sub-
sidiaries subject to Capitalized Lease Obligations to the extent
such Capitalized Lease Obligations are permitted by Section
9.04(iv), provided that (x) such Liens only serve to secure the
payment of Indebtedness arising under such Capitalized Lease
Obligation, (y) except as otherwise expressly permitted under
clause (z) below, (1) to the extent that any such Lien is in
respect of Real Property, there shall be no recourse against
Holdings or any of its Subsidiaries in respect of such
Capitalized Lease Obligation other than against the specific
Real Property subject to such Lien and (2) the Lien encumbering
the asset giving rise to the Capitalized Lease Obligation does
not encumber any other asset of the Borrower or any Subsidiary
of the Borrower and (z) such Liens may encumber, in addition to
the asset giving rise to the Capitalized Lease Obligation, any
other assets of the Borrower or any Subsidiary of the Borrower
securing Capitalized Lease Obligations permitted to be incurred
hereunder and owing to the same lessor;
(vii) Liens placed upon equipment, machinery or other
property (including Real Property) used in the business of the
Borrower or any of its Subsidiaries at the time of the
acquisition or construction thereof by the Borrower or any such
Subsidiary or within 365 days thereafter to secure Indebtedness
incurred to pay all or a portion of the purchase price or
construction costs thereof or to secure Indebtedness incurred
solely for the purpose of financing the acquisition or
construction of any such equipment, machinery or other property
(including Real Property) or extensions, renewals or replace-
ments of any of the foregoing for the same or a lesser amount,
provided that (x) such Indebtedness is permitted by Section
9.04(iv), (y) except as otherwise expressly permitted under
clause (z) below, (1) the Lien encumbering the equipment,
machinery or other property (including Real Property) so
acquired or constructed does not encumber any other asset of the
Borrower or such Subsidiary and (2) to the extent that any such
Lien is in respect of Real Property, there shall be no recourse
against Holdings or any of its Subsidiaries in respect of such
Indebtedness other than against the specific Real Property
subject to such Lien and (z) such Liens may encumber, in
addition to the equipment, machinery or other property
(including Real Property) so acquired or constructed, any other
assets of the Borrower or any Subsidiary of the Borrower
securing Indebtedness permitted to be incurred under Section
9.04(iv) and owing to the same lender;
(viii) easements, rights-of-way, restrictions, encroach-
ments, zoning restrictions and other similar charges or
encumbrances, and minor title deficiencies, in each case not
securing Indebtedness and not materially interfering with the
conduct of the business of Holdings and its Subsidiaries taken
as a whole;
(ix) Liens arising from precautionary UCC financing
statement filings regarding operating leases;
(x) Liens arising out of the existence of judgments or
awards in respect of which Holdings or any of its Subsidiaries
shall in good faith be prosecuting an appeal or proceedings for
review in respect of which there shall have been secured a
subsisting stay of execution pending such appeal or proceedings,
provided that the aggregate amount of any cash and the fair
market value of any property subject to such Liens do not exceed
$20,000,000 at any time outstanding;
(xi) statutory and common law landlords' liens under
leases to which Holdings or any of its Subsidiaries is a party;
(xii) Liens (other than Liens imposed under ERISA) incurred
in the ordinary course of business in connection with workers
compensation claims, unemployment insurance and other types of
social security;
(xiii) Liens securing the performance of bids, tenders,
leases and contracts in the ordinary course of business, statu-
tory obligations, surety bonds, performance bonds, utility
payments and other obligations of a like nature incurred in the
ordinary course of business (exclusive of obligations in respect
of the payment for borrowed money);
(xiv) Liens securing Indebtedness permitted under Section
9.04(xi), which Liens were existing prior to the time the entity
which incurred such Indebtedness became a Subsidiary of
Holdings, provided that such Liens were not incurred in
connection with, or in contemplation of, the acquisition of such
Subsidiary and do not attach to any other asset of Holdings or
any of its Subsidiaries;
(xv) Liens in favor of third parties as consignors (or as
creditors of such consignors) in goods which are delivered to
the Borrower or any of its Subsidiaries by such third parties on
consignment in the ordinary course of business and consistent
with past practices, the value of which goods so held on
consignment shall at no time exceed $10,000,000 in the aggregate
for the Borrower and its Subsidiaries;
(xvi) Liens on inventory of the Borrower and its
Subsidiaries securing Indebtedness permitted by Section
9.04(viii);
(xvii) Liens granted with respect to the Collateral pursuant
to the SL Collateral Documents in favor of the SL Agent or the
SL Lenders to secure the obligations of the Credit Parties under
the SL Guaranty, provided that (x) such Liens shall at all times
be subject to the Intercreditor Agreement and such Liens shall
only be permitted until the release of Collateral under Section
8.15 (and not at any time thereafter) and (y) each XX Xxxxxx
Collateral Document or any Credit Party's security interest in
any of the SL Properties shall concurrently and ratably secure
the Obligations under the Credit Documents (other than
exceptions with respect to the assignment of the Lease or any
Lease Supplement (as each such term is defined in Annex A to the
SL Participation Agreement));
(xviii) Permitted Encumbrances;
(xix) any (x) interest or title of a lessor or sublessor
(other than a Credit Party) under any lease entered into by
Holdings or any of its Subsidiaries as lessee to the extent that
such lease is permitted to be entered into pursuant to this
Agreement, (y) restriction or encumbrance to which the interest
or title of such lessor or sublessor may be subject (including,
without limitation, ground leases and other prior leases of the
premises, mortgages, mechanics liens, tax liens and easements)
or (z) subordination of the interest of the lessee or sublessee
under any such lease to any restriction or encumbrance referred
to in the preceding clause (y);
(xx) Liens in favor of customs or revenue authorities
arising as a matter of law to secure payment of customs duties
in connection with the importation of goods;
(xxi) Liens not otherwise permitted by clauses (i) through
(xx) above securing Indebtedness of the Borrower or any of its
Subsidiaries, provided that (x) the aggregate principal amount
of Indebtedness secured by Liens permitted by this clause (xxi)
shall not exceed $10,000,000 at any time outstanding, (y) any
such Indebtedness shall be permitted under Section 9.04 and (z)
such Liens shall not attach to any Collateral; and
(xxii) the replacement, extension or renewal of any Lien
permitted by this Section 9.01 upon or in the same property
subject to such Lien and as security for the same obligations or
any refinancings thereof to the extent such refinancings are
permitted under Section 9.04, provided that such Lien does not
extend to or cover any property other than property covered by
such Lien immediately prior to such replacement, extension or
renewal of such Lien and the principal amount of the obligations
secured thereby is not increased.
In connection with the granting of Liens of the type described in
clauses (vi) and (vii) of this Section 9.01 by the Borrower or any of
its Subsidiaries, the Administrative Agent and the Collateral Agent
shall be authorized to and shall take any actions necessary to be
taken by it in connection therewith (including, without limitation,
by executing appropriate lien releases or lien subordination
agreements in favor of the holder or holders of such Liens, in either
case solely with respect to the item or items of property subject to
such Liens).
9.02 Consolidation, Merger, Purchase or Sale of Assets,
etc. Holdings will not, and will not permit any of its Subsidiaries
to, wind up, liquidate or dissolve its affairs or enter into any
transaction of merger or consolidation, or convey, sell, lease or
otherwise dispose of all or any part of its property or assets, or
enter into any sale-leaseback transactions, or purchase or otherwise
acquire (in one or a series of related transactions) any part of the
property or assets (other than purchases or other acquisitions of
inventory, materials and equipment in the ordinary course of
business) of any Person (or agree to do any of the foregoing at any
future time), except that:
(i) Capital Expenditures by Holdings and its Subsidiaries
shall be permitted to the extent not in violation of Section
9.07;
(ii) each of the Borrower and its Subsidiaries may make
sales of Cash Equivalents and inventory in the ordinary course
of business;
(iii) each of the Borrower and its Subsidiaries may sell
damaged, obsolete or worn-out assets that are no longer
necessary for the proper conduct of their respective business
for fair market value and in the ordinary course of business;
(iv) each of the Borrower and its Subsidiaries may sell or
discount, in each case without recourse and in the ordinary
course of business, accounts receivable arising in the ordinary
course of business, but only in connection with the compromise
or collection thereof;
(v) each of the Borrower and its Subsidiaries may sell or
otherwise transfer in an arm's-length transaction to a Developer
of a Development Site constituting a Development Investment
permitted under Section 9.05(xiv);
(vi) each of the Borrower and its Subsidiaries may sell or
otherwise dispose of other assets in an aggregate amount not to
exceed $200,000 per sale or other disposition or series of
related sales or other dispositions, provided that the aggregate
value of all such sales or other dispositions pursuant to this
clause (vi) shall not exceed $2,000,000 in any fiscal year of
the Borrower;
(vii) each of the Borrower and its Subsidiaries may sell
stores which are no longer useful to the business of the
Borrower and its Subsidiaries, provided that the aggregate
number of stores sold pursuant to this clause (vii) in any
fiscal year of the Borrower shall not exceed five plus, for
fiscal year 1998 and each fiscal year of the Borrower
thereafter, a number of stores equal to the difference between
five and the number of stores sold under this clause (vii) in
the immediately preceding fiscal year of the Borrower;
(viii) the Borrower and its Subsidiaries may (x) sell (i)
either or both the warehouse facility located at 0000 Xxxx 00xx
Xxxxxx, Xxxxxxx, Xxxxxxxx and the garage connected to Donna's
Meat Facility located at 0000 Xxxxxxxx Xxxxxx, Xxxxxx Xxxx,
Xxxxxxxx, (ii) the warehouse described in Part (a) of Schedule
XI, (iii) either or both the office building and print shop
described in Part (a) of Schedule XI, and (iv) store number 92
described in Schedule III, (y) sell and concurrently lease-back
the equipment described in Part (b) of Schedule XI and (z) sell
other assets having an aggregate fair market value not in excess
of $5,000,000 in any fiscal year, so long as in each case for
preceding clauses (x), (y) and (z), (i) no Default or Event of
Default then exists or would result therefrom, (ii) the Borrower
or the respective Subsidiary receives at least fair market value
(as determined in good faith by the Borrower or such Subsidiary,
as the case may be) and (iii) the total consideration received
by the Borrower or such Subsidiary is at least 50% cash and is
paid at the time of the closing of such sale;
(ix) Investments may be made to the extent permitted by
Section 9.05;
(x) each of the Borrower and its Subsidiaries may lease
(as lessee) real or personal property (so long as any such lease
does not create a Capitalized Lease Obligation except to the
extent permitted by Section 9.04(iv));
(xi) each of the Borrower and its Subsidiaries may grant
leases or subleases to other Persons not materially interfering
with the conduct of the business of the Borrower and its
Subsidiaries taken as a whole;
(xii) each of the Borrower and its Subsidiaries may
consummate Permitted Sale-Leaseback Transactions;
(xiii) any Subsidiary of the Borrower (x) may be merged,
consolidated or liquidated with or into the Borrower so long as
the Borrower is the surviving corporation of such merger,
consolidation or liquidation and (y) may transfer all or any
portion of its assets to the Borrower; and
(xiv) any Subsidiary of the Borrower (x) may be merged,
consolidated or liquidated with or into any other Subsidiary of
the Borrower so long as (i) in the case of any such merger,
consolidation or liquidation involving a Subsidiary Guarantor,
the Subsidiary Guarantor is the surviving corporation of such
merger, consolidation or liquidation and (ii) in addition to the
requirements of preceding clause (i), in the case of any such
merger, consolidation or liquidation involving a Wholly-Owned
Subsidiary of the Borrower, the Wholly-Owned Subsidiary is the
surviving corporation of such merger, consolidation or
liquidation, (y) may transfer all or any portion of its assets
to any Subsidiary Guarantor and (z) may, so long as such
Subsidiary is not a Subsidiary Guarantor, (i) be merged,
consolidated or liquidated with or into any other Subsidiary of
the Borrower that is not a Subsidiary Guarantor and (ii)
transfer all or any portion of its assets to any other
Subsidiary of the Borrower that is not a Subsidiary Guarantor.
Notwithstanding anything to the contrary contained above in this
Section 9.02, Holdings will not, and will not permit any of its
Subsidiaries to, sell the capital stock or other equity interest in
any Subsidiary of Holdings other than a sale of 100% of the capital
stock or other equity interests in any Subsidiary of the Borrower in
accordance with the provisions set forth above in this Section 9.02.
To the extent the Required Banks waive the provisions of this Section
9.02 with respect to the sale of any Collateral, or any Collateral is
sold as permitted by this Section 9.02 (other than to the Borrower or
a Subsidiary thereof), such Collateral shall be sold free and clear
of the Liens created by the Security Documents and the Administrative
Agent and the Collateral Agent shall be authorized to and shall take
any actions necessary in order to effect the foregoing.
9.03 Dividends. Holdings will not, and will not permit any of
its Subsidiaries to, authorize, declare or pay any Dividends with
respect to Holdings or any of its Subsidiaries, except that:
(i) any Subsidiary of the Borrower may pay cash Dividends
to the Borrower or to any Wholly-Owned Subsidiary of the
Borrower;
(ii) any non-Wholly-Owned Subsidiary of the Borrower may
pay cash Dividends to its shareholders generally so long as the
Borrower or its respective Subsidiary which owns the equity
interest in the Subsidiary paying such Dividends receives at
least its proportionate share thereof (based upon its relative
holding of the equity interest in the Subsidiary paying such
Dividends and taking into account the relative preferences, if
any, of the various classes of equity interests of such
Subsidiary);
(iii) so long as there shall exist no Default or Event of
Default (both before and after giving effect to the payment
thereof), Holdings or any of its Subsidiaries may repurchase
outstanding shares of Holdings Common Stock (or options to pur-
chase such common stock) held by employees or former employees
of Holdings or any of its Subsidiaries, provided that the aggre-
gate amount of the cash portion of such purchases and the
aggregate cash payment made with respect to promissory notes
issued to such employees or former employees in connection with
a previous purchase of such employee's Holdings Common Stock (or
options to purchase such common stock) does not exceed the sum
of (1) $3,500,000 in any fiscal year of Holdings plus (2) the
aggregate amount of cash proceeds received by Holdings in such
fiscal year from its sale of shares of Holdings Common Stock to
a stock option or other stock plan of Holdings or any of its
Subsidiaries or to any participant in any such plan or to any
employee of Holding or any of its Subsidiaries during such
fiscal year except to the extent that such additional cash
proceeds increased the amount of the basket for stock
repurchases pursuant to Section 9.03(vii);
(iv) so long as there shall exist no Default or Event of
Default (both before and after giving effect to the payment
thereof), the Borrower may pay cash Dividends to Holdings so
long as Holdings promptly uses such proceeds for the purposes
described in clause (iii) of this Section 9.03;
(v) the Borrower may pay cash Dividends to Holdings so
long as the proceeds thereof are promptly used by Holdings to
pay operating expenses and Illinois franchise taxes in the
ordinary course of business (including, without limitation,
professional fees and expenses) and other similar corporate
overhead costs and expenses;
(vi) the Borrower may pay cash Dividends to Holdings for
the sole purpose of paying Holdings' and its Subsidiaries'
income tax obligations to the extent and at the times required
by the Holdings Tax Sharing Agreement;
(vii) so long as there shall exist no Default or Event of
Default (both before and after giving effect to the payment
thereof), (x) the Borrower may pay cash Dividends to Holdings
for the sole purpose of allowing Holdings to repurchase Holdings
Common Stock (and Holdings may (and shall promptly upon receipt
of such Dividends) so repurchase Holdings Common Stock with all
such Dividend payments) in an aggregate amount (together with
the aggregate amount used by the Borrower and its Subsidiaries
to purchase Holdings Common Stock pursuant to clause (y) of this
Section 9.03(vii)) not to exceed $35,000,000 (plus the aggregate
amount of cash proceeds received by Holdings after the Effective
Date from any sale or issuance of Holdings Common Stock except
to the extent that such additional cash proceeds increased the
amount of the basket for stock repurchases pursuant to
Section 9.03(iii)) and (y) the Borrower and its Subsidiaries may
purchase Holdings Common Stock in an aggregate amount (together
with the aggregate amount of Dividends made to Holdings pursuant
to clause (x) of this Section 9.03(vii)) not to exceed
$35,000,000 (plus the aggregate amount of cash proceeds received
by Holdings after the Effective Date from any sale or issuance
of Holdings Common Stock except to the extent that such
additional cash proceeds increased the amount of the basket for
stock repurchases pursuant to Section 9.03(iii));
(viii) so long as there shall exist no Default or Event of
Default (both before and after giving effect to the payment
thereof), the Borrower may pay cash Dividends to Holdings for
the purpose of enabling Holdings to pay cash Dividends to, or to
repurchase, redeem or otherwise acquire Holdings Common Stock
from, the holders of Holdings Common Stock and the Borrower and
its Subsidiaries may repurchase, redeem or otherwise acquire
Holdings Common Stock from the holders thereof, provided that
(x) the aggregate amount of cash Dividends paid and cash paid
for all such repurchases, redemptions and other acquisitions
pursuant to this clause (viii) in any fiscal year of Holdings,
when added to the aggregate amount of Intercompany Loans made
for such purposes pursuant to Section 9.05(x) during such fiscal
year, shall not exceed the sum of (1) $3,000,000 and (2) the
lesser of (A) the Cumulative Income Amount at such time and (B)
$2,000,000, and (y) the Leverage Ratio for the Test Period then
most recently ended (which Leverage Ratio shall be evidenced by
a certificate of the president, the chief financial officer or
the treasurer of Holdings delivered to the Administrative Agent
at least three Business Days prior to declaration of such
Dividends) does not exceed 3.00:1.00; and
(ix) the Borrower may pay cash Dividends to Holdings for
the purpose of enabling Holdings to make stock acquisitions of
Persons who will, upon such acquisition, become a Wholly-Owned
Subsidiary of Holdings to the extent permitted by Sections
9.05(xii) and 9.07.
9.04 Indebtedness. Holdings will not, and will not permit
any of its Subsidiaries to, contract, create, incur, assume or suffer
to exist any Indebtedness, except:
(i) Indebtedness incurred pursuant to this Agreement and
the other Credit Documents;
(ii) Existing Indebtedness outstanding on the Effective
Date and listed on Schedule V, and any subsequent extension,
renewal or refinancing thereof, provided that the aggregate
principal amount of the Indebtedness to be extended, renewed or
refinanced does not increase from that amount outstanding at the
time of any such extension, renewal or refinancing;
(iii) Indebtedness under Interest Rate Protection
Agreements entered into with respect to other Indebtedness
permitted under this Section 9.04;
(iv) Indebtedness of the Borrower and its Subsidiaries
evidenced by Capitalized Lease Obligations and Indebtedness
subject to Liens permitted under Section 9.01(vii), provided
that (x) in no event shall the sum of (I) the aggregate
outstanding principal amount of all Capitalized Lease
Obligations and (II) the aggregate outstanding principal amount
of all such Indebtedness at any time exceed an amount equal to
the aggregate principal amount of all Capitalized Lease
Obligations and all such other Indebtedness outstanding on the
Effective Date plus $150,000,000;
(v) Indebtedness of Holdings, the Borrower and the
Subsidiary Guarantors consisting of Contingent Obligations under
the SL Guaranty;
(vi) intercompany Indebtedness among Holdings and its
Subsidiaries to the extent permitted by Sections 9.05(viii),
(ix) and (x);
(vii) Indebtedness consisting of guaranties by the Borrower
and its Subsidiaries of other Indebtedness, Operating Leases and
other obligations of the Borrower and its Subsidiaries otherwise
permitted to be incurred under this Agreement;
(viii) each of the Borrower and its Subsidiaries may become
and remain liable with respect to Indebtedness represented by
Deferred Trade Payables in an aggregate amount not to exceed
$10,000,000 at any time outstanding;
(ix) Holdings or any of its Subsidiaries may become and
remain liable with respect to Indebtedness evidenced by
promissory notes subordinated to the Obligations and issued to
employees and former employees of Holdings or any of its
Subsidiaries in lieu of cash payment for stock of Holdings
required to be purchased pursuant to Holdings' or any of the
Subsidiaries' stock option or other stock plans, provided that
the aggregate principal amount of all such Indebtedness does not
exceed $5,000,000 at any time outstanding;
(x) to the extent that any Senior Subordinated Notes
remain outstanding after giving effect to the Senior
Subordinated Note Tender Offer, Indebtedness of the Borrower and
the Subsidiary Guarantors evidenced by such remaining Senior
Subordinated Notes (less the principal amount of all repayments
made in respect thereof after the Effective Date);
(xi) Subsidiaries of Holdings acquired after the Effective
Date, the acquisition of which is permitted under Section 9.07,
may remain liable with respect to Indebtedness existing
immediately prior to the time any such entity became a
Subsidiary of Holdings, provided that (x) such Indebtedness was
not incurred in connection with or in contemplation of such
acquisition and (y) the aggregate principal amount of all such
Indebtedness outstanding at any one time shall not exceed
$10,000,000, provided, further, that such Subsidiaries may
become and remain liable with respect to Indebtedness incurred
to refinance such existing Indebtedness if, after giving effect
to such refinancing Indebtedness and the repayment of the
corresponding existing Indebtedness with the proceeds thereof,
(a) the aggregate principal amount of the refinancing
Indebtedness and the corresponding existing Indebtedness so
refinanced shall not be greater than the outstanding principal
amount of such existing Indebtedness immediately prior to such
refinancing, (b) the weighted average life to maturity of such
refinancing Indebtedness shall be no shorter than that of the
existing Indebtedness being refinanced and (c) such refinancing
Indebtedness shall not be secured by any additional property
than that which secures the existing Indebtedness being
refinanced;
(xii) each of the Borrower and its Subsidiaries may become
and remain liable with respect to Contingent Obligations under
guaranties in the ordinary course of business of the obligations
of suppliers, customers, franchisees, lessors and licensees of
the Borrower and its Subsidiaries in an aggregate amount which,
when added to the aggregate amount the amount of Investments
made under Section 9.05(xv), shall not exceed $5,000,000 at any
time;
(xiii) Indebtedness of the Borrower and its Subsidiaries in
respect of Other Hedging Agreements entered into in the ordinary
course of business for bona fide hedging activities;
(xiv) so long as no Default or Event of Default then exists
or would result therefrom, Contingent Obligations of the
Borrower and its Subsidiaries in respect of obligations of a
Developer, provided that (x) no such Contingent Obligation shall
be incurred unless, at the time of the incurrence of such
Contingent Obligation, the Development Site and the store
located or to be located at the Development Site have been
leased or irrevocably committed by the Developer to be leased to
the Borrower or one of its Subsidiaries and (y) the amount of
such Contingent Obligations (including any payments made by the
Borrower or any of its Subsidiaries in respect thereof), when
aggregated with the amount of Investments made under Section
9.05(xiv), shall not exceed $30,000,000 at any time outstanding;
and
(xv) additional Indebtedness incurred by the Borrower and
its Subsidiaries in an aggregate principal amount not to exceed
$40,000,000 at any one time outstanding.
9.05 Advances, Investments and Loans. Holdings will not,
and will not permit any of its Subsidiaries to, directly or
indirectly, lend money or credit or make advances to any Person, or
purchase or acquire any stock, obligations or securities of, or any
other interest in, or make any capital contribution to, any other
Person, or purchase or own a futures contract or otherwise become
liable for the purchase or sale of currency or other commodities at a
future date in the nature of a futures contract, or hold any cash or
Cash Equivalents (each of the foregoing an "Investment" and,
collectively, "Investments"), except that the following shall be
permitted:
(i) the Borrower and its Subsidiaries may acquire and
hold accounts receivables owing to any of them, if created or
acquired in the ordinary course of business and payable or
dischargeable in accordance with customary trade terms of the
Borrower or such Subsidiary;
(ii) Holdings and its Subsidiaries may acquire and hold
cash and Cash Equivalents;
(iii) the Borrower and its Subsidiaries may hold the
Investments held by them on the Effective Date and described on
Schedule VIII, provided that any additional Investments made
with respect thereto shall be permitted only if independently
justified under the other provisions of this Section 9.05;
(iv) the Borrower and its Subsidiaries may acquire and own
investments (including debt obligations) received in connection
with the bankruptcy or reorganization of suppliers and customers
and in good faith settlement of delinquent obligations of, and
other disputes with, customers and suppliers arising in the
ordinary course of business;
(v) the Borrower and its Subsidiaries may make loans and
advances to their respective employees so long as the aggregate
principal amount thereof at any time outstanding (determined
without regard to any write-downs or write-offs of such loans
and advances) shall not exceed $5,000,000;
(vi) Holdings may acquire and hold obligations of one or
more officers or other employees of Holdings or any of its
Subsidiaries in connection with such officers' or employees'
acquisition of shares of Holdings Common Stock so long as no
cash is paid by Holdings or any of its Subsidiaries to such
officers or employees in connection with the acquisition of any
such obligations;
(vii) the Borrower may enter into Interest Rate Protection
Agreements to the extent permitted by Section 9.04(iii);
(viii) the Borrower and the Subsidiary Guarantors may make
Intercompany Loans between or among one another so long as (i)
each Intercompany Loan shall be evidenced by an Intercompany
Note that is, prior to the Collateral Release Date, pledged to
the Collateral Agent pursuant to the applicable Pledge Agreement
and (ii) the Borrower's obligations under all Intercompany Loans
made to it shall be subordinate in right of payment to the
payment in full of the Obligations pursuant to the terms of the
applicable Intercompany Note and the subordination provisions
attached thereto;
(ix) the Borrower and its Subsidiaries may enter into
Other Hedging Agreements to the extent permitted by Section
9.04(xiii);
(x) the Borrower may, in lieu of paying cash Dividends to
Holdings pursuant to (and as permitted by) Section 9.03, make
Intercompany Loans to Holdings for the purposes described in
such Sections and otherwise subject to the dollar and other
limitations set forth therein;
(xi) Holdings may make equity contributions to the capital
of the Borrower and the Borrower and the Subsidiary Guarantors
may make equity contributions to the capital of their respective
Subsidiaries which are Subsidiary Guarantors;
(xii) Holdings and its Subsidiaries may create or acquire
new Subsidiaries to the extent otherwise permitted under this
Agreement, provided that (x) any such new Subsidiary is wholly-
owned by Holdings and/or one of its Wholly-Owned Subsidiaries
and the provisions of Sections 8.12 and 8.13 have been complied
with, (y) to the extent that such new Subsidiary is created or
acquired by Holdings, Holdings promptly thereafter contributes
the stock of such new Subsidiary to the Borrower and (z) to the
extent such creation or acquisition constitutes a Capital
Expenditure, such Capital Expenditure is permitted under Section
9.07;
(xiii) the Borrower and its Subsidiaries may acquire and
hold non-cash consideration received in connection with an Asset
Sale to the extent permitted by Section 9.02, provided that (x)
the aggregate principal amount of all non-cash consideration
received shall not at any time exceed $7,000,000 (determined
without regard to any write-offs or write-downs thereof) and (y)
until the Collateral Release Date, all such non-cash
consideration shall be pledged pursuant to the applicable Pledge
Agreement or Security Agreement, as the case may be;
(xiv) so long as no Default or Event of Default then exists
or would result therefrom, the Borrower or any of its
Subsidiaries may make Development Investments in or to any
Developer, provided that (x) no such Development Investment
shall be permitted unless, at the time of the making of such
Development Investment, the Development Site and the store
located or to be located at the Development Site have been
leased or irrevocably committed by the Developer to be leased to
the Borrower or one of its Subsidiaries, (y) except for
Contingent Obligations permitted pursuant to Section 9.04(xiv),
neither the Borrower nor any of its Subsidiaries may be or
become a general partner of any Developer or otherwise be liable
in any manner for any Indebtedness or any other obligations of
any Developer (other than pursuant to customary provisions
contained in any lease pertaining to a Development Site or a
store leased to the Borrower or one of its Subsidiaries) and (z)
the aggregate amount of all such Development Investments plus
the aggregate amount of all Contingent Obligations outstanding
pursuant to Section 9.04(xiv) (including any payments made by
the Borrower or any of its Subsidiaries in respect of such
Contingent Obligations) shall not exceed $30,000,000 at any time
outstanding;
(xv) each of the Borrower and its Subsidiaries may make
and own Investments (x) in suppliers in anticipation of becoming
a customer of such suppliers and in lieu of deposits, cash
discounts or concessions and (y) in connection with joint
ventures with suppliers entered into in the ordinary course of
business, provided that the aggregate amount of all such
Investments under clauses (x) and (y), together with the amount
of guaranties permitted under Section 9.04(xii), shall not
exceed $5,000,000 at any time outstanding;
(xvi) the Borrower and its Subsidiaries may purchase
Holdings Common Stock to the extent permitted pursuant to
Sections 9.03(iii),(vii) and (viii); and
(xvii) the Borrower and its Subsidiaries may make additional
Investments in an aggregate amount not to exceed at any time
$25,000,000, provided that no more than $15,000,000 of such
Investments may be made in Unrestricted Subsidiaries.
9.06 Transactions with Affiliates. Holdings will not, and
will not permit any of its Subsidiaries to, enter into any
transaction or series of related transactions with any Affiliate of
Holdings or any of its Subsidiaries, other than on terms and condi-
tions substantially as favorable to Holdings or such Subsidiary as
would reasonably be obtained by Holdings or such Subsidiary at that
time in a comparable arm's-length transaction with a Person other
than an Affiliate, except that the following in any event shall be
permitted:
(i) Dividends may be paid to the extent provided in
Section 9.03;
(ii) loans may be made and other transactions may be
entered into by Holdings and its Subsidiaries to the extent
permitted by Sections 9.02, 9.04 and 9.05;
(iii) reasonable and customary fees may be paid to
directors of Holdings and its Subsidiaries;
(iv) transactions between or among the Borrower and its
Wholly-Owned Subsidiaries to the extent that such transactions
are not otherwise restricted under this Agreement;
(v) issuances of stock, payments of bonuses and other
transactions pursuant to employment or compensation agreements,
stock option agreements, indemnification agreements and other
arrangements with employees and directors of Holdings or any of
its Subsidiaries in the ordinary course of business;
(vi) payments by Holdings and its Subsidiaries under the
Holdings Tax Sharing Agreements;
(vii) payment of consulting and other fees and expenses
under the Yucaipa Management Agreement; and
(viii) the issuance by Holdings of Holdings Common Stock to
Yucaipa pursuant to the exercise of the Yucaipa Warrant.
9.07 Capital Expenditures. (a) Holdings will not, and
will not permit any of its Subsidiaries to, make any Capital
Expenditures, except that (i) during the period from November 3, 1996
through and including November 1, 1997, Holdings and its Subsidiaries
may make Capital Expenditures in an aggregate amount not to exceed
$75,000,000 and (ii) during any fiscal year of Holdings thereafter
(taken as one accounting period), Holdings and its Subsidiaries may
make Capital Expenditures so long as the aggregate amount of all such
Capital Expenditures does not exceed $90,000,000 in any such fiscal
year, it being understood and agreed, however, that any Capital
Expenditures made by Holdings pursuant to this Section 9.07(a) or
pursuant to Section 9.07(b) shall be permitted only to the extent
that such Capital Expenditures constitute a stock acquisition of a
Person who will, upon such acquisition, become a Subsidiary of
Holdings and Holdings promptly contributes the stock of such Person
to the Borrower.
(b)(i) In addition to the foregoing, in the event that the
amount of Capital Expenditures permitted to be made by Holdings and
its Subsidiaries pursuant to clause (a) above in any fiscal year of
Holdings (before giving effect to any increase in such permitted
Capital Expenditure amount pursuant to this clause (b)(i) but after
giving effect to any reduction in such amount as a result of Capital
Expenditures made pursuant to clause (b)(ii) below) is greater than
the amount of Capital Expenditures actually made by Holdings and its
Subsidiaries during such fiscal year, such excess may be carried
forward and utilized to make Capital Expenditures in the immediately
succeeding fiscal year; provided that in no event shall the aggregate
amount of Capital Expenditures made by Holdings and its Subsidiaries
during any fiscal year pursuant to Section 9.07(a), this clause
(b)(i) and clause (b)(ii) below exceed 130% of the permitted Capital
Expenditure amount for such fiscal year as set forth in
Section 9.07(a) (before giving effect to any reduction in such amount
pursuant to clause (b)(ii) below as a result of Capital Expenditures
made pursuant to clause (b)(ii) below).
(ii) In addition to the foregoing, commencing in the
Borrower's fiscal year beginning November 2, 1997, in the event that
Holdings and its Subsidiaries have made Capital Expenditures in any
fiscal year pursuant to clauses (a) and (b)(i) above in an amount
equal to the maximum amount permitted to be made in such fiscal year
pursuant to such clauses and so long as no Default or Event of
Default then exists, Holdings and its Subsidiaries may make Capital
Expenditures in such fiscal year by utilizing expenditure amounts
permitted to be made in the immediately succeeding fiscal year
pursuant to clause (a) above and any such Capital Expenditures made
pursuant to this clause (b)(ii) in such current fiscal year shall
reduce the amount of Capital Expenditures permitted to be made in the
immediately succeeding fiscal year, provided that in no event shall
the aggregate amount of Capital Expenditures made by Holdings and its
Subsidiaries during any fiscal year pursuant to Section 9.07(a),
clause (b)(i) above and this clause (b)(ii) exceed 130% of the
permitted Capital Expenditure amount for such fiscal year as set
forth in Section 9.07(a) (before giving effect to any reduction in
such amount pursuant to this clause (b)(ii) as a result of Capital
Expenditures made pursuant to this clause (b)(ii)).
(c) In addition to the foregoing, the Borrower and it
Subsidiaries may make Capital Expenditures with the amount of Net
Sale Proceeds received by the Borrower or any of its Subsidiaries
from any Asset Sale reinvested within 365 days following the date of
such Asset Sale to the extent such Net Sale Proceeds are not
otherwise required to be applied to reduce the Total Revolving Loan
Commitment pursuant to Section 3.03(b).
(d) In addition to the foregoing, the Borrower and its
Subsidiaries may make Capital Expenditures with the amount of Net
Insurance Proceeds received by the Borrower or any of its
Subsidiaries from any Recovery Event so long as such Net Insurance
Proceeds are used to replace or restore any properties or assets in
respect of which such Net Insurance Proceeds were paid within 365
days following the date of receipt of such Net Insurance Proceeds
from such Recovery Event to the extent such Net Insurance Proceeds
are not otherwise required to be applied to reduce the Total
Revolving Loan Commitment pursuant to Section 3.03(d).
(e) Notwithstanding anything to the contrary contained
herein, (i) the aggregate cumulative amount of purchase price with
respect to Store Land Properties shall not exceed at any time
$25,000,000 minus the aggregate cumulative amount of losses incurred
by the Credit Parties after the Effective Date with respect to any
Store Land Property acquired after the Effective Date (which losses
shall be calculated on or after the date of the sale or other
disposition of such Store Land Property as the purchase price of such
Store Land Property minus the cash proceeds received by the
applicable Credit Party on or before such date of calculation in
connection with such sale or other disposition) and (ii) the Borrower
and its Subsidiaries shall not acquire any Store Land Properties so
long as a Default or Event of Default has occurred and is continuing
or would result therefrom.
9.08 Minimum Fixed Charge Coverage Ratio. Holdings and
the Borrower will not permit the Fixed Charge Coverage Ratio for any
Test Period ending on the last day of a fiscal quarter of Holdings
set forth below to be less than the ratio set forth opposite such
fiscal quarter below:
Fiscal Quarter Ratio
4th Fiscal Quarter, 1997 1.55:1.00
1st Fiscal Quarter, 1998 1.55:1.00
2nd Fiscal Quarter, 1998 1.55:1.00
3rd Fiscal Quarter, 1998 1.55:1.00
4th Fiscal Quarter, 1998 1.55:1.00
1st Fiscal Quarter, 1999 1.60:1.00
2nd Fiscal Quarter, 1999 1.60:1.00
3rd Fiscal Quarter, 1999 1.65:1.00
4th Fiscal Quarter, 1999 1.65:1.00
1st Fiscal Quarter, 2000 1.65:1.00
2nd Fiscal Quarter, 2000 1.65:1.00
3rd Fiscal Quarter, 2000 1.70:1.00
4th Fiscal Quarter, 2000 1.70:1.00
1st Fiscal Quarter, 2001 1.70:1.00
2nd Fiscal Quarter, 2001 1.70:1.00
3rd Fiscal Quarter, 2001 1.75:1.00
4th Fiscal Quarter, 2001 1.75:1.00
1st Fiscal Quarter, 2002 1.75:1.00
2nd Fiscal Quarter, 2002 1.75:1.00
3rd Fiscal Quarter, 2002 1.75:1.00
4th Fiscal Quarter, 2002 1.75:1.00
1st Fiscal Quarter, 2003 1.75:1.00
2nd Fiscal Quarter, 2003 1.75:1.00
3rd Fiscal Quarter, 2003 1.75:1.00
4th Fiscal Quarter, 2003 1.75:1.00
1st Fiscal Quarter, 2004 1.75:1.00
2nd Fiscal Quarter, 2004 1.75:1.00
9.09 Maximum Leverage Ratio. Holdings and the Borrower
will not permit the Leverage Ratio as of the last day of any fiscal
quarter of Holdings set forth below to be greater than the ratio set
forth opposite such fiscal quarter below:
Fiscal Quarter Ratio
4th Fiscal Quarter, 1997 5.00:1.00
1st Fiscal Quarter, 1998 5.00:1.00
2nd Fiscal Quarter, 1998 5.00:1.00
3rd Fiscal Quarter, 1998 4.75:1.00
4th Fiscal Quarter, 1998 4.50:1.00
1st Fiscal Quarter, 1999 4.25:1.00
2nd Fiscal Quarter, 1999 4.00:1.00
3rd Fiscal Quarter, 1999 3.75:1.00
4th Fiscal Quarter, 1999 3.50:1.00
1st Fiscal Quarter, 2000 3.50:1.00
2nd Fiscal Quarter, 2000 3.50:1.00
3rd Fiscal Quarter, 2000 3.50:1.00
4th Fiscal Quarter, 2000 3.50:1.00
1st Fiscal Quarter, 2001 3.50:1.00
2nd Fiscal Quarter, 2001 3.50:1.00
3rd Fiscal Quarter, 2001 3.50:1.00
4th Fiscal Quarter, 2001 3.50:1.00
1st Fiscal Quarter, 2002 3.50:1.00
2nd Fiscal Quarter, 2002 3.50:1.00
3rd Fiscal Quarter, 2002 3.50:1.00
4th Fiscal Quarter, 2002 3.50:1.00
1st Fiscal Quarter, 2003 3.50:1.00
2nd Fiscal Quarter, 2003 3.50:1.00
3rd Fiscal Quarter, 2003 3.50:1.00
4th Fiscal Quarter, 2003 3.50:1.00
1st Fiscal Quarter, 2004 3.50:1.00
2nd Fiscal Quarter, 2004 3.50:1.00
9.10 Minimum Consolidated Net Worth. Holdings and the
Borrower will not permit Consolidated Net Worth at any time during a
period set forth below to be less than the amount set forth opposite
such period below:
Minimum Consolidated
Period Net Worth
4th Fiscal Quarter, 1997 $90,000,000
1st Fiscal Quarter, 1998 $90,000,000
2nd Fiscal Quarter, 1998 $90,000,000
3rd Fiscal Quarter, 1998 $95,000,000
4th Fiscal Quarter, 1998 $100,000,000
1st Fiscal Quarter, 1999 $105,000,000
2nd Fiscal Quarter, 1999 $110,000,000
3rd Fiscal Quarter, 1999 $120,000,000
4th Fiscal Quarter, 1999 $130,000,000
1st Fiscal Quarter, 2000 $140,000,000
2nd Fiscal Quarter, 2000 $150,000,000
3rd Fiscal Quarter, 2000 $160,000,000
4th Fiscal Quarter, 2000 $170,000,000
1st Fiscal Quarter, 2001 $185,000,000
2nd Fiscal Quarter, 2001 $195,000,000
3rd Fiscal Quarter, 2001 $210,000,000
4th Fiscal Quarter, 2001 $225,000,000
1st Fiscal Quarter, 2002 $240,000,000
2nd Fiscal Quarter, 2002 $255,000,000
3rd Fiscal Quarter, 2002 $275,000,000
4th Fiscal Quarter, 2002 $290,000,000
1st Fiscal Quarter, 2003 $305,000,000
2nd Fiscal Quarter, 2003 $325,000,000
3rd Fiscal Quarter, 2003 $350,000,000
4th Fiscal Quarter, 2003 $370,000,000
1st Fiscal Quarter, 2004 $390,000,000
2nd Fiscal Quarter, 2004 $410,000,000
9.11 Limitation on Voluntary Payments and Modifications of
Certain Indebtedness; Limitation on Modifications of Certificate of
Incorporation, By-Laws and Certain Other Agreements. Holdings will
not, and will not permit any of its Subsidiaries to:
(i) make (or give any notice in respect of) any voluntary
or optional payment or prepayment on or redemption or
acquisition for value of (including, without limitation, by way
of depositing with the trustee with respect thereto or any other
Person money or securities before due for the purpose of paying
when due) any Senior Subordinated Note other than pursuant to
the Senior Subordinated Note Tender Offer, provided that the
Borrower may voluntarily or optionally prepay, repurchase or
redeem Senior Subordinated Notes so long as no Default or Event
of Default then exists or would result therefrom;
(ii) make (or give any notice in respect of) any
prepayment or redemption of any Senior Subordinated Note as a
result of any asset sale, change of control or similar event
(including, without limitation, by way of depositing with the
trustee with respect thereto or any other Person money or
securities before due for the purpose of paying when due any
Senior Subordinated Note);
(iii) amend, modify or change, or permit the amendment,
modification or change of, any provision of any Senior
Subordinated Note Document (other than pursuant to the Senior
Subordinated Note Indenture Supplement);
(iv) amend, modify or change, or permit the amendment,
modification or change of, any provision of any SL Document if
the effect of such amendment, modification or change is to
increase the interest rate on any such SL Document, change any
dates upon which payments of principal or interest are due
thereon, change any of the covenants with respect thereto in a
manner which is more restrictive to Holdings or any of its
Subsidiaries, change any event of default or condition to an
event of default with respect thereto, change the redemption,
prepayment or defeasance provisions thereof, or change any
collateral therefor (other than to release such collateral), or
if the effect of such amendment, modification or change,
together with all other amendments, modifications or changes
made, is to increase the obligations of the obligor thereunder
or to confer any additional rights on the holders of such SL
Documents (or a trustee or other representative on their behalf)
which would be adverse to any Credit Party or the Banks in any
material respect;
(v) enter into any SL Document after the Effective Date
unless such SL Document has been consented to by the Agents or
such SL Document is an SL Collateral Document that is subject to
the Intercreditor Agreement and is substantially similar to an
SL Collateral Document previously consented to by the Agents or,
in the case of a lease, is substantially similar to a form of
lease previously approved by the Agents;
(vi) amend, modify or change its certificate or articles
of incorporation (including, without limitation, by the filing
or modification of any certificate of designation) or by-laws
(or the equivalent organizational documents) or any agreement
entered into by it with respect to its capital stock (including
any Shareholders' Agreement), or enter into any new agreement
with respect to its capital stock, if such amendment,
modification, change or other action contemplated by this clause
(vi) could reasonably be expected to be adverse to the interests
of the Banks in any material respect;
(vii) amend, modify or change, or permit the amendment,
modification or change of, any provision of any Tax Sharing
Agreement or any Management Agreement or enter into any new tax
sharing agreement, tax allocation agreement or similar
agreements or any new management or consulting agreement if the
effect of any such amendment, modification or change will
increase materially the obligations of Holdings or any of its
Subsidiaries or confer additional rights on any other party to
any such agreement which could reasonably be expected to be
adverse to Holdings or any of its Subsidiaries or to the Banks
in any material respect; or
(viii) so long as any Senior Subordinated Notes remain
outstanding, designate any other Indebtedness as "Designated
Senior Indebtedness" (as defined in the Senior Subordinated Note
Indenture) for purposes of the Senior Subordinated Note
Indenture.
9.12 Limitation on Certain Restrictions on Subsidiaries.
Holdings will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create or otherwise cause or suffer to exist
or become effective any encumbrance or restriction on the ability of
any such Subsidiary to (a) pay dividends or make any other distribu-
tions on its capital stock or any other interest or participation in
its profits owned by Holdings or any Subsidiary of Holdings, or pay
any Indebtedness owed to Holdings or any Subsidiary of Holdings, (b)
make loans or advances to Holdings or any Subsidiary of Holdings or
(c) transfer any of its properties or assets to Holdings or any
Subsidiary of Holdings, except for such encumbrances or restrictions
existing under or by reason of (i) applicable law, (ii) this
Agreement and the other Credit Documents, (iii) the SL Documents,
(iv) customary provisions restricting subletting or assignment of any
lease governing a leasehold interest of Holdings or any Subsidiary of
Holdings, (v) customary provisions restricting assignment of any
licensing agreement or agreements for the provision of services
entered into by Holdings or any Subsidiary of Holdings in the
ordinary course of business and (vi) restrictions on the transfer of
any asset subject to a Lien permitted by Section 9.01.
9.13 Limitation on Issuance of Capital Stock.
(a) Holdings will not, and will not permit any of its Subsidiaries
to, issue (i) any preferred stock (other than Qualified Holdings
Preferred Stock) or (ii) any redeemable common stock (other than
common stock that is redeemable at the sole option of Holdings or
such Subsidiary).
(b) Holdings will not permit any of its Subsidiaries to
issue any capital stock (including by way of sales of treasury stock)
or any options or warrants to purchase, or securities convertible
into, capital stock, except (i) for transfers and replacements of
then outstanding shares of capital stock, (ii) for stock splits,
stock dividends and issuances which do not decrease the percentage
ownership of Holdings or any of its Subsidiaries in any class of the
capital stock of such Subsidiary, (iii) to qualify directors to the
extent required by applicable law or (iv) for issuances by newly
created or acquired Subsidiaries in accordance with the terms of this
Agreement.
9.14 Business. (a) Holdings and its Subsidiaries will
not engage in any businesses other than the businesses engaged in by
the Borrower and its Subsidiaries as of the Effective Date and rea-
sonable extensions thereof and similar and related businesses.
(b) Notwithstanding the foregoing, Holdings will not
engage in any business and will not own any significant assets or
have any material liabilities other than its ownership of the capital
stock of the Borrower and its temporary ownership of new Subsidiaries
created or acquired after the date hereof in accordance with the
terms of this Agreement and having those liabilities which it is
responsible for under this Agreement and the other Documents to which
it is a party, provided that Holdings may engage in those activities
and have those liabilities that are incidental to (w) its ownership
interest in the Borrower and new Subsidiaries created or acquired
after the date hereof in accordance with the terms of this Agreement,
(x) the maintenance of its corporate existence in compliance with
applicable law, (y) legal, tax and accounting matters in connection
with any of the foregoing activities and (z) the entering into, and
performing its obligations under, this Agreement and the other
Documents to which it is a party.
SECTION 10. Events of Default. Upon the occurrence of any
of the following specified events (each an "Event of Default"):
10.01 Payments. The Borrower shall (i) default in the
payment when due of any principal of any Loan or any Note or any
Unpaid Drawing or (ii) default, and such default shall continue
unremedied for five or more days, in the payment when due of any
interest on any Loan, Note or Unpaid Drawing or any Fees or any other
amounts owing hereunder or thereunder; or
10.02 Representations, etc. Any representation, warranty
or statement made (or deemed made) by any Credit Party herein or in
any other Credit Document or in any certificate delivered to any
Agent or any Bank pursuant hereto or thereto shall prove to be untrue
in any material respect on the date as of which made or deemed made;
or
10.03 Covenants. (a) Any Credit Party shall (i) default
in the due performance or observance by it of any term, covenant or
agreement contained in Section 8.01(f)(i) or 8.08 or Section 9 or
(ii) default in the due performance or observance by it of any other
term, covenant or agreement contained in this Agreement or any other
Credit Document (other than those set forth in Sections 10.01 and
10.02) and such default shall continue unremedied for a period of 30
days after written notice thereof to the defaulting party by any
Agent or the Required Banks or (b) the XX Xxxxxx shall default in the
due performance or observance by it of any term, covenant or
agreement contained in Section 4.1 or Section 5 of the XX Xxxxxx
Guaranty; or
10.04 Default Under Other Agreements. (i) Holdings or
any of its Subsidiaries shall (x) default in any payment of any
Indebtedness (other than the Notes) beyond the period of grace, if
any, provided in the instrument or agreement under which such
Indebtedness was created or (y) default in the observance or
performance of any agreement or condition relating to any
Indebtedness (other than the Notes) or contained in any instrument or
agreement evidencing, securing or relating thereto, or any other
event shall occur or condition exist, the effect of which default or
other event or condition is to cause, or to permit the holder or
holders of such Indebtedness (or a trustee or agent on behalf of such
holder or holders) to cause (determined without regard to whether any
notice is required), any such Indebtedness to become due prior to its
stated maturity, or (ii) any Indebtedness (other than the Notes) of
Holdings or any of its Subsidiaries shall be declared to be (or shall
become) due and payable, or required to be prepaid other than by a
regularly scheduled required prepayment, prior to the stated maturity
thereof, provided that it shall not be a Default or an Event of
Default under this Section 10.04 unless the aggregate principal
amount of all Indebtedness as described in preceding clauses (i) and
(ii) is at least $10,000,000; or
10.05 Bankruptcy, etc. Holdings or any of its
Subsidiaries (other than an Immaterial Subsidiary) or the XX Xxxxxx
shall commence a voluntary case concerning itself under Title 11 of
the United States Code entitled "Bankruptcy," as now or hereafter in
effect, or any successor thereto (the "Bankruptcy Code"); or an
involuntary case is commenced against Holdings or any of its
Subsidiaries (other than an Immaterial Subsidiary) or the XX Xxxxxx,
and the petition is not controverted within 20 days, or is not dis-
missed within 60 days, after commencement of the case; or a custodian
(as defined in the Bankruptcy Code) is appointed for, or takes charge
of, all or substantially all of the property of Holdings or any of
its Subsidiaries (other than an Immaterial Subsidiary) or the XX
Xxxxxx, or Holdings or any of its Subsidiaries (other than an
Immaterial Subsidiary) or the XX Xxxxxx commences any other pro-
ceeding under any reorganization, arrangement, adjustment of debt,
relief of debtors, dissolution, insolvency or liquidation or similar
law of any jurisdiction whether now or hereafter in effect relating
to Holdings or any of its Subsidiaries (other than an Immaterial
Subsidiary) or the XX Xxxxxx, or there is commenced against Holdings
or any of its Subsidiaries (other than an Immaterial Subsidiary) or
the XX Xxxxxx any such proceeding which remains undismissed for a
period of 60 days, or Holdings or any of its Subsidiaries (other than
an Immaterial Subsidiary) or the XX Xxxxxx is adjudicated insolvent
or bankrupt; or any order of relief or other order approving any such
case or proceeding is entered; or Holdings or any of its Subsidiaries
(other than an Immaterial Subsidiary) or the XX Xxxxxx suffers any
appointment of any custodian or the like for it or any substantial
part of its property to continue undischarged or unstayed for a
period of 60 days; or Holdings or any of its Subsidiaries (other than
an Immaterial Subsidiary) or the XX Xxxxxx makes a general assignment
for the benefit of creditors; or any corporate action is taken by
Holdings or any of its Subsidiaries (other than an Immaterial
Subsidiary) or the XX Xxxxxx for the purpose of effecting any of the
foregoing; or
10.06 ERISA. (a) Any Plan shall fail to satisfy the
minimum funding standard required for any plan year or part thereof
under Section 412 of the Code or Section 302 of ERISA or a waiver of
such standard or extension of any amortization period is sought or
granted under Section 412 of the Code or Section 303 or 304 of ERISA,
a Reportable Event shall have occurred, a contributing sponsor (as
defined in Section 4001(a)(13) of ERISA) of a Plan subject to Title
IV of ERISA shall be subject to the advance reporting requirement of
PBGC Regulation Section 4043.61 (without regard to subparagraph
(b)(1) thereof) and an event described in subsection .62, .63, .64,
.65, .66, .67 or .68 of PBGC Regulation Section 4043 shall be
reasonably expected to occur with respect to such Plan within the
following 30 days, any Plan which is subject to Title IV of ERISA
shall have had or is likely to have a trustee appointed to administer
such Plan, any Plan which is subject to Title IV of ERISA is, shall
have been or is likely to be terminated or to be the subject of
termination proceedings under ERISA, any Plan shall have an Unfunded
Current Liability, a contribution required to be made with respect to
a Plan has not been timely made, Holdings or any Subsidiary of
Holdings or any ERISA Affiliate has incurred or is likely to incur
any liability to or on account of a Plan under Section 409, 502(i),
502(l), 515, 4062, 4063, 4064, 4069, 4201, 4204 or 4212 of ERISA or
Section 401(a)(29), 4971 or 4975 of the Code or on account of a group
health plan (as defined in Section 607(1) of ERISA or Section
4980B(g)(2) of the Code) under Section 4980B of the Code, or Holdings
or any Subsidiary of Holdings has incurred or is likely to incur
liabilities pursuant to one or more employee welfare benefit plans
(as defined in Section 3(1) of ERISA) that provide benefits to
retired employees or other former employees (other than as required
by Section 601 of ERISA) or Plans; (b) there shall result from any
such event or events the imposition of a lien, the granting of a
security interest, or a liability or a material risk of incurring a
liability; and (c) such lien, security interest or liability,
individually, and/or in the aggregate, has had, or could reasonably
be expected to have, a material adverse effect on the business,
operations, properties, assets, liabilities or condition (financial
or otherwise) of the Borrower and the Guarantors taken as a whole; or
10.07 Security Documents. At any time after the execution
and delivery thereof and prior to the Collateral Release Date, any of
the Security Documents shall cease to be in full force and effect, or
shall cease to give the Collateral Agent for the benefit of the
Secured Creditors the Liens, rights, powers and privileges purported
to be created thereby (including, without limitation, a perfected
first priority security interest in, and Lien on, any significant
part of the Collateral, in favor of the Collateral Agent, superior to
and prior to the rights of all third Persons (except as permitted by
Section 9.01), and subject to no other Liens (except as permitted by
Section 9.01)); or
10.08 Guaranty. At any time after the execution and
delivery thereof, any Guaranty or any provision thereof shall cease
to be in full force or effect as to any Guarantor (except in
accordance with the express terms thereof) or any Guarantor or any
Person acting by or on behalf of such Guarantor shall deny or
disaffirm such Guarantor's obligations under its Guaranty or any
Guarantor shall default in the due performance or observance of any
term, covenant or agreement on its part to be performed or observed
pursuant to its Guaranty; or
10.09 Judgments. One or more judgments or decrees shall
be entered against Holdings or any Subsidiary of Holdings involving
individually or in the aggregate for Holdings and its Subsidiaries a
liability (not paid or fully covered by a reputable and solvent
insurance company) and such judgments and decrees either shall be
final and non-appealable or shall not be vacated, discharged or
stayed or bonded pending appeal for any period of 60 consecutive
days, and the aggregate amount of all such judgments shall equal or
exceed $20,000,000; or
10.10 Default Under or Relating To SL Documents or XX
Xxxxxx Guaranty. (i) The XX Xxxxxx or any other Credit Party shall
have failed to pay when due any principal of or interest on or any
other obligations under any SL Document beyond the end of any grace
period provided therefor; (ii) the XX Xxxxxx or any other Credit
Party shall be in breach of, or shall be in default with respect to,
any material terms of any SL Document if the effect of such breach or
default is to cause, or to permit any SL Lender or the SL Agent to
cause any Indebtedness or any Contingent Obligations (as each such
term is defined in Annex A to the SL Participation Agreement)
thereunder to become or be declared due and payable prior to its
stated maturity or the stated maturity of any underlying obligations,
as the case may be (including, without limitation, the occurrence and
continuation of an Event of Default (as such term is defined in Annex
A to the SL Participation Agreement)); (iii) any representation,
warranty or statement made (or deemed made) by the XX Xxxxxx in the
XX Xxxxxx Guaranty or in connection therewith shall prove to be
untrue in any material respect on the date as of which made or deemed
made; (iv) the XX Xxxxxx shall have defaulted in the performance of
or compliance with any term contained in the XX Xxxxxx Guaranty
(other than any such term referred to in Section 10.03) and such
default shall not have been remedied or waived within 30 days after
the receipt by the XX Xxxxxx of notice from the SL Agent or any SL
Lender of such default; or (v) any party to the Intercreditor
Agreement (other than Administrative Agent) shall be in breach of, or
shall be in default with respect to, to any material term of the
Intercreditor Agreement; or
10.11 Change of Control. A Change of Control shall occur;
then, and in any such event, and at any time thereafter, if any Event
of Default shall then be continuing, the Administrative Agent, upon
the written request of the Required Banks, shall by written notice to
the Borrower, take any or all of the following actions, without
prejudice to the rights of any Agent, any Bank or the holder of any
Note to enforce its claims against any Credit Party (provided, that,
if an Event of Default specified in Section 10.05 shall occur with
respect to the Borrower, the result which would occur upon the giving
of written notice by the Administrative Agent as specified in clauses
(i) and (ii) below shall occur automatically without the giving of
any such notice): (i) declare the Total Revolving Loan Commitment
terminated, whereupon the Revolving Loan Commitment of each Bank
shall forthwith terminate immediately and any Commitment Commission
shall forthwith become due and payable without any other notice of
any kind; (ii) declare the principal of and any accrued interest in
respect of all Loans and the Notes and all Obligations owing here-
under and thereunder to be, whereupon the same shall become,
forthwith due and payable without presentment, demand, protest or
other notice of any kind, all of which are hereby waived by each
Credit Party; (iii) terminate any Letter of Credit which may be
terminated in accordance with its terms; (iv) direct the Borrower to
pay (and the Borrower agrees that upon receipt of such notice, or
upon the occurrence of an Event of Default specified in Section 10.05
with respect to the Borrower, it will pay) to the Collateral Agent at
the Payment Office such additional amount of cash or Cash
Equivalents, to be held as security by the Collateral Agent pursuant
to the Collateral Account Agreement, as is equal to the aggregate
Stated Amount of all Letters of Credit issued for the account of the
Borrower and then outstanding; (v) enforce, as Collateral Agent, all
of the Liens and security interests created pursuant to the Security
Documents; and (vi) apply any cash collateral held by the
Administrative Agent pursuant to Section 4.02 to the repayment of the
Obligations.
SECTION 11. Definitions and Accounting Terms.
11.01 Defined Terms. As used in this Agreement, the
following terms shall have the following meanings (such meanings to
be equally applicable to both the singular and plural forms of the
terms defined):
"Administrative Agent" shall mean BTCo, in its capacity as
Administrative Agent for the Banks hereunder, and shall include any
successor to the Administrative Agent appointed pursuant to Section
12.09.
"Affiliate" shall mean, with respect to any Person, any
other Person directly or indirectly controlling, controlled by, or
under direct or indirect common control with, such Person. A Person
shall be deemed to control another Person if such Person possesses,
directly or indirectly, the power (i) to vote 10% or more of the
securities having ordinary voting power for the election of directors
of such corporation or (ii) to direct or cause the direction of the
management and policies of such other Person, whether through the
ownership of voting securities, by contract or otherwise; provided
that neither BTCo, Chase nor any of their Affiliates shall be
considered to be an "Affiliate" of Holdings or any of its
Subsidiaries.
"Agent" shall mean and include each of the Administrative
Agent and the Syndication Agent.
"Agreement" shall mean this Credit Agreement, as modified,
supplemented, amended, restated (including any amendment and
restatement hereof), extended, renewed, refinanced or replaced from
time to time.
"Applicable Commitment Commission Percentage" shall mean
(i) for the period from the Effective Date through but not including
the first Start Date after the Effective Date, .300% and (ii) from
and after any Start Date to and including the corresponding End Date,
the respective percentage per annum set forth in clause (A), (B),
(C), (D) or (E) below if, but only if, as of the Test Date for such
Start Date the applicable condition set forth in clause (A), (B),
(C), (D) or (E) below, as the case may be, is met:
(A) .300% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be greater than or equal to 4.00:100;
(B) .250% if, by only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 4.00:1:00 and greater than equal to
3.50:1.00;
(C) .200% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 3.50:1.00 and greater than or equal
to 3.00:1.00;
(D) .150% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 3.00:1.00 and greater than or equal
to 2.50:1.00; and
(E) .125% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 2.50:1.00.
Notwithstanding anything to the contrary contained above in this
definition, the Applicable Commitment Commission Percentage shall be
.300% at all times when a Default or Event of Default under Section
8.01(a), 8.01(b) or 8.01(e) shall exist.
"Applicable Eurodollar Rate Margin" shall mean (i) for the
period from the Effective Date through but not including the first
Start Date after the Effective Date, .875% and (ii) from and after
any Start Date to and including the corresponding End Date, the
respective percentage per annum set forth in clause (A), (B), (C),
(D) or (E) below if, but only if, as of the Test Date for such Start
Date the applicable condition set forth in clause (A), (B), (C), (D)
or (E) below, as the case may be, is met:
(A) .875% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be greater than or equal to 4.00:1.00;
(B) .750% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 4.00:1.00 and greater than or equal
to 3.50:1.00;
(C) .625% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 3.50:1.00 and greater than or equal
to 3.00:1.00;
(D) .500% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 3.00:1.00 and greater than or equal
to 2.50:1.00; and
(E) .375% if, but only if, as of the Test Date for such
Start Date the Leverage Ratio for the Test Period ended on such
Test Date shall be less than 2.50:1.00.
Notwithstanding anything to the contrary contained above in this
definition, the Applicable Eurodollar Rate Margin shall be .875% at
all times when a Default or an Event of Default under Section
8.01(a), 8.01(b) or 8.01(e) shall exist.
"Asset Sale" shall mean any sale, transfer or other
disposition by Holdings or any of its Subsidiaries to any Person
(including by-way-of redemption by such Person) other than to
Holdings or a Wholly-Owned Subsidiary of Holdings of any asset
(including, without limitation, any capital stock or other securities
of, or equity interests in, another Person) other than sales of
assets pursuant to Sections 9.02 (ii), (iii), (iv), (v), (vi), (xi)
and (xii), provided that any sale, transfer or other disposition
pursuant to Section 9.02(xii) shall be treated as an Asset Sale in
the event that the respective Permitted Sale-Leaseback Transaction
occurs more than 365 days after the opening of the related grocery
store or purchase of the related equipment.
"Assignment and Assumption Agreement" shall mean an
Assignment and Assumption Agreement substantially in the form of
Exhibit O (appropriately completed).
"Bank" shall mean each financial institution listed on
Schedule I, as well as any Person which becomes a "Bank" hereunder
pursuant to Section 1.13 or 13.04(b).
"Bank Default" shall mean (i) the refusal (which has not
been retracted) or the failure of a Bank to make available its por-
tion of any Borrowing required to be made available by it hereunder
(including any Mandatory Borrowing) or to fund its portion of any
unreimbursed payment under Section 2.04(c) or (ii) a Bank having
notified in writing the Borrower and/or the Administrative Agent that
such Bank does not intend to comply with its obligations under
Section 1.01(a), 1.01(c) or 2, in the case of either clause (i) or
(ii) as a result of any takeover or control (including, without
limitation, as a result of the occurrence of any event of the type
described in Section 10.05 with respect to such Bank) of such Bank by
any regulatory authority or agency.
"Bank Refinancing" shall mean, collectively, the repayment
in full of the Existing Credit Agreement, together with all accrued
interest, premiums, fees, commissions and expenses owing in
connection therewith, and the termination of all commitments
thereunder.
"Bankruptcy Code" shall have the meaning provided in
Section 10.05.
"Base Rate" shall mean, at any time, the higher of (i) the
Prime Lending Rate and (ii) 1/2 of 1% in excess of the Federal Funds
Rate.
"Base Rate Loan" shall mean (i) each Swingline Loan and
(ii) each Revolving Loan designated or deemed designated as such by
the Borrower at the time of the incurrence thereof or conversion
thereto.
"BDI" shall mean Blackhawk Developments, Inc. (formerly
known as Xxxx Developments, Inc.), a Delaware corporation.
"Borrower" shall have the meaning provided in the first
paragraph of this Agreement.
"Borrower Pledge Agreement" shall have the meaning provided
in Section 5.11.
"Borrower Security Agreement" shall have the meaning
provided in Section 5.12.
"Borrower Trademark Security Agreement" shall have the
meaning provided in Section 5.13.
"Borrowing" shall mean (i) the borrowing of Swingline Loans
from the Swingline Bank on a given date and (ii) the borrowing of one
Type of Revolving Loan from all the Banks on a given date (or re-
sulting from a conversion or conversions on such date) having in the
case of Eurodollar Loans the same Interest Period, provided that Base
Rate Loans incurred pursuant to Section 1.10(b) shall be considered
part of the related Borrowing of Eurodollar Loans.
"BPI" shall mean Blackhawk Properties, Inc. (formerly known
as Xxxx Properties, Inc.), a Delaware corporation.
"BTCo" shall mean Bankers Trust Company, in its individual
capacity, and any successor corporation thereto by merger,
consolidation or otherwise.
"Business Day" shall mean (i) for all purposes other than
as covered by clause (ii) below, any day except Saturday, Sunday and
any day which shall be in New York City, New York or Chicago,
Illinois, a legal holiday or a day on which banking institutions are
authorized or required by law or other government action to close and
(ii) with respect to all notices and determinations in connection
with, and payments of principal and interest on, Eurodollar Loans,
any day which is a Business Day described in clause (i) above and
which is also a day for trading by and between banks in the New York
interbank Eurodollar market.
"Capital Expenditures" shall mean, for any period, an
amount equal to (i) the sum of (a) the aggregate of all expenditures
(whether paid in cash or other consideration or accrued as a
liability and including that portion of Capital Leases which is
capitalized on the consolidated balance sheet of Holdings and its
Subsidiaries) by Holdings and its Subsidiaries during that period
that are included in "property, plant or equipment" or comparable
items reflected in the consolidated balance sheet of Holdings and its
Subsidiaries, plus (b) to the extent not covered by clause (i)(a) of
this definition, the aggregate of all expenditures by Holdings and
its Subsidiaries during that period to acquire (by purchase or
otherwise) the business, property or fixed assets of any Person, or
the stock or other evidence of beneficial ownership of any Person
that, as a result of such acquisition, becomes Subsidiary of
Holdings, plus (c) to the extent the purchase price thereof has been
deducted from "Capital Expenditures" during such period or any prior
period pursuant to clause (ii)(a)(2) below, the aggregate purchase
price of any Store Land Property for which a notice has been given
during such period pursuant to clause (b) of the proviso in the
definition of "Store Land Property", minus (ii) the sum of (a) all
Capital Expenditures (as defined in clause (i) above) constituting
(1) Development Investments permitted under Section 9.05(xiv) or (2)
the purchase price of Store Land Properties constituting undeveloped
land or land with improvements thereon existing as of the date of
acquisition thereof permitted under Section 9.07, (b) the proceeds of
Indebtedness permitted under Section 9.04(iv), and (c) an amount
equal to the proceeds received by the Borrower or any of its
Subsidiaries from a Permitted Sale-Leaseback Transaction so long as
such transaction occurs within 365 days of the completion of the
respective store and to the extent prior expenditures, up to an
equivalent amount for the asset so sold and leased back, constituted
Capital Expenditures (as defined above), provided that, with respect
to the Borrower and its Subsidiaries, expenditures made by any such
Person pursuant to the exercise of the purchase option in the SL
Documents and applied to prepay amounts due thereunder shall not
constitute Capital Expenditures.
"Capitalized Lease Obligations" shall mean, with respect to
any Person, all rental obligations of such Person which, under
generally accepted accounting principles, are or will be required to
be capitalized on the books of such Person, in each case taken at the
amount thereof accounted for as indebtedness in accordance with such
principles.
"Capital Lease" shall mean, with respect to any Person, any
lease of property (whether real, personal or mixed) by such Person as
lessee which, under generally accepted accounting principles, is
required to be accounted for as a capital lease on the books of such
Person.
"Cash Equivalents" shall mean, as to any Person, (i)
securities issued or directly and fully guaranteed or insured by the
United States or any agency or instrumentality thereof (provided that
the full faith and credit of the United States is pledged in support
thereof) having maturities of not more than one year from the date of
acquisition, (ii) Dollar denominated time deposits and certificates
of deposit of any commercial bank having, or which is the principal
banking subsidiary of a bank holding company having, a long-term
unsecured debt rating of at least "A" or the equivalent thereof from
S&P or "A2" or the equivalent thereof from Xxxxx'x with maturities of
not more than one year from the date of acquisition by such Person,
(iii) repurchase obligations with a term of not more than seven days
for underlying securities of the types described in clause (i) above
entered into with any bank meeting the qualifications specified in
clause (ii) above, (iv) commercial paper issued by any Person incor-
porated in the United States rated at least A-1 or the equivalent
thereof by S&P or at least P-1 or the equivalent thereof by Xxxxx'x
and in each case maturing not more than one year after the date of
acquisition by such Person, (v) marketable direct obligations issued
by the District of Columbia or any State of the United States or any
political subdivision of any such State or any public instrumentality
thereof maturing within one year from the date of acquisition and, at
the time of acquisition, having one of the two highest ratings
obtainable from either S&P or Xxxxx'x and (vi) investments in money
market funds substantially all of whose assets are comprised of
securities of the types described in clauses (i) through (v) above.
"Cash Proceeds" shall mean, with respect to any Asset Sale,
the aggregate cash payments (including any cash received by way of
deferred payment pursuant to a note receivable issued in connection
with such Asset Sale or pursuant to a receivable or otherwise, other
than (in each case) the portion of such deferred payment constituting
interest, but only as and when so received) received by Holdings
and/or any of its Subsidiaries from such Asset Sale.
"CERCLA" shall mean the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980, as the same may be
amended from time to time, 42 U.S.C. S 9601 et seq.
"Change of Control" shall mean (i) any Person or "group"
(within the meaning of Section 13(d) and 14(d) under the Securities
Exchange Act, as in effect on the Effective Date), other than the
Permitted Holders, shall (A) have acquired beneficial ownership of
25% or more on a fully diluted basis of the voting and/or economic
interest in Holdings' capital stock unless the Permitted Holders
have, at such time, the ability by voting power, contract or
otherwise to elect or designate for election a majority of the Board
of Directors of Holdings and the Permitted Holders also own a greater
percentage on a fully diluted basis of the economic interests in
Holdings' capital stock than such other Person or "group" or (B)
obtained the power (whether or not exercised) to elect a majority of
Holdings' directors, (ii) the Board of Directors of Holdings shall
cease to consist of a majority of Continuing Directors, (iii)
Holdings shall cease to own 100% of the economic and voting interest
in the Borrower's capital stock, or (iv) so long as any Senior
Subordinated Notes remain outstanding, a "Change of Control" under
(and as defined in) the Senior Subordinated Note Indenture shall
occur.
"Chase" shall mean The Chase Manhattan Bank, in its
individual capacity, and any successor thereto by merger,
consolidation or otherwise.
"Co-Arrangers" shall mean BTCo and Chase Securities Inc.,
each in its capacity as Co-Arranger for the Banks hereunder.
"Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time, and the regulations promulgated and
rulings issued thereunder. Section references to the Code are to the
Code, as in effect at the date of this Agreement and any subsequent
provisions of the Code, amendatory thereof, supplemental thereto or
substituted therefor.
"Collateral" shall mean all property (whether real or
personal) with respect to which any security interests have been
granted (or purported to be granted) pursuant to any Security
Document, including, without limitation, all Pledged Collateral, all
Security Agreement Collateral, all Trademark Agreement Collateral,
the Mortgaged Properties and all cash and Cash Equivalents delivered
as collateral pursuant to Section 4.02 or 10.
"Collateral Account Agreement" shall have the meaning
provided in Section 5.14.
"Collateral Agent" shall mean the Administrative Agent
acting as collateral agent for the Secured Creditors pursuant to the
Security Documents.
"Collateral Release Conditions" shall have the meaning
provided in Section 8.15.
"Collateral Release Date" shall have the meaning provided
in Section 8.15.
"Commitment Commission" shall have the meaning set forth in
Section 3.01.
"Consolidated Cash Interest Expense" shall mean, for any
period, Consolidated Interest Expense for such period net of any
interest income received in cash by Holdings or any of its
Subsidiaries for such period, but excluding, however, any interest
expense not payable in cash for such period (including amortization
of discounts and amortization of debt issuance cost).
"Consolidated EBITDA" shall mean, for any period, without
duplication, the sum of the amounts for such period of (i)
Consolidated Net Income, (ii) Consolidated Interest Expense, (iii)
provisions for taxes based on income, (iv) all amortization of
intangibles and depreciation that were deducted in arriving at
Consolidated Net Income for such period and (v) all other non-cash
items (including, without limitation, the non-cash charges for the
write-down or write-off of inventory, property, equipment, goodwill
and other assets in connection with the Borrower's conversion of its
Omni stores) that were deducted in arriving at Consolidated Net
Income for such period less other non-cash items that were included
in arriving at Consolidated Net Income for such period, all of the
foregoing as determined on a consolidated basis for Holdings and its
Subsidiaries.
"Consolidated Fixed Charges" shall mean, for any period,
the sum of, without duplication, (i) Consolidated Cash Interest
Expense for such period, (ii) Consolidated Rental Payments for such
period and (iii) the scheduled principal amount of all amortization
payments on all Indebtedness of Holdings and its Subsidiaries for
such period (as determined on the first day of the respective
period).
"Consolidated Indebtedness" shall mean, at any time, the
aggregate stated balance sheet amount of all Indebtedness of Holdings
and its Subsidiaries, determined on a consolidated basis at such
time.
"Consolidated Interest Expense" shall mean, for any period,
the total consolidated interest expense of Holdings and its Subsidi-
aries for such period (calculated without regard to any limitations
on the payment thereof) net of any interest income received by
Holdings and its Subsidiaries for such period plus, without dupli-
cation, that portion of Capitalized Lease Obligations of Holdings and
its Subsidiaries representing the interest factor for such period and
the amount of all commissions, discounts and other fees and charges
owed with respect of letters of credit and bankers' acceptance
financing and net costs under Interest Rate Protection Agreements of
Holdings or any of its Subsidiaries for such period; provided that
the amortization of deferred financing costs with respect to this
Agreement and the Existing Credit Agreement shall be excluded from
Consolidated Interest Expense to the extent same would otherwise have
been included therein.
"Consolidated Net Income" shall mean, for any period, the
net income (or loss) of Holdings and its Subsidiaries for such
period, determined on a consolidated basis (and after deductions for
minority interests), provided that (i) the net income of any other
Person which is not a Subsidiary of Holdings (including any
Unrestricted Subsidiary) or is accounted for by Holdings by the
equity method of accounting shall be included only to the extent of
the payment of cash dividends or distributions by such other Person
to Holdings or a Subsidiary thereof during such period, (ii) the net
income of any Subsidiary of Holdings (other than the Borrower) shall
be excluded to the extent that the declaration or payment of
dividends or similar distributions by that Subsidiary of its income
is not at the time permitted by operation of the terms of its charter
or any agreement, instrument or law applicable to such Subsidiary,
(iii) the net income (or loss) of any Person accrued prior to the
date it becomes a Subsidiary of Holdings or is merged into or
consolidated with Holdings or any of its Subsidiaries or that
Person's assets are acquired by Holdings or any of its Subsidiaries
shall (in each case) be excluded, (iv) any after-tax gains or losses
attributable to Asset Sales or returned surplus assets of any Pension
Plan shall be excluded and (v) (to the extent not included in clauses
(i) through (iv) above) any net extraordinary gains or net non-cash
extraordinary losses shall (in each case) be excluded.
"Consolidated Net Worth" shall mean, at any time, the
capital stock and additional paid-in capital plus retained earnings
(or minus accumulated deficits) of Holdings and its Subsidiaries at
such time.
"Consolidated Rental Payments" shall mean, for any period,
the aggregate amount of all rents paid or payable by Holdings and its
Subsidiaries during such period under all Operating Leases to which
Holdings or any of its Subsidiaries is a party as lessee (net of
sublease income) as determined on a consolidated basis.
"Contingent Obligation" shall mean, as to any Person, any
obligation of such Person as a result of such Person being a general
partner of any other Person, unless the underlying obligation is
expressly made non-recourse as to such general partner, and any
obligation of such Person guaranteeing or intended to guarantee any
Indebtedness, leases, dividends or other obligations ("primary
obligations") of any other Person (the "primary obligor") in any
manner, whether directly or indirectly, including, without
limitation, any obligation of such Person, whether or not contingent,
(i) to purchase any such primary obligation or any property consti-
tuting direct or indirect security therefor, (ii) to advance or sup-
ply funds (x) for the purchase or payment of any such primary
obligation or (y) to maintain working capital or equity capital of
the primary obligor or otherwise to maintain the net worth or
solvency of the primary obligor, (iii) to purchase property,
securities or services primarily for the purpose of assuring the
owner of any such primary obligation of the ability of the primary
obligor to make payment of such primary obligation or (iv) otherwise
to assure or hold harmless the holder of such primary obligation
against loss in respect thereof; provided, however, that the term
Contingent Obligation shall not include endorsements of instruments
for deposit or collection in the ordinary course of business. The
amount of any Contingent Obligation shall be deemed to be an amount
equal to the stated or determinable amount of the primary obligation
in respect of which such Contingent Obligation is made or, if not
stated or determinable, the maximum reasonably anticipated liability
in respect thereof (assuming such Person is required to perform
thereunder) as determined by such Person in good faith.
"Continuing Directors" shall mean the directors of Holdings
on the Effective Date and each other director if such director's
nomination for election to the Board of Directors of Holdings is
recommended by a majority of the then Continuing Directors.
"Covered Real Property" shall have the meaning provided in
Section 8.13.
"Credit Documents" shall mean this Agreement and, after the
execution and delivery thereof pursuant to the terms of this
Agreement, each Note, the Subsidiaries Guaranty, each Security
Document and the XX Xxxxxx Guaranty.
"Credit Event" shall mean the making of any Loan (other
than a Revolving Loan made pursuant to a Mandatory Borrowing) or the
issuance of any Letter of Credit.
"Credit Party" shall mean Holdings, the Borrower and each
Subsidiary Guarantor and any Land Trust (but not any Land Trustee,
except solely in its capacity as trustee of a Land Trust); provided
that, for purposes of Sections 9.01(xvii), 10.02., 10.03, 10.07,
10.08, 12 and 13, the term "Credit Party" shall also include the XX
Xxxxxx.
"Cumulative Consolidated Net Income" shall mean, at any
time for the determination thereof, Consolidated Net Income for the
period (taken as one accounting period) commencing on November 2,
1997 and ending on the last day of the most recently ended fiscal
quarter of Holdings.
"Cumulative Income Amount" shall mean, at any time for the
determination thereof, (i) the product of (A) 0.50 multiplied by (B)
Cumulative Consolidated Net Income at such time minus (ii) the
aggregate amount of cash Dividends theretofore paid or stock
repurchases made pursuant to Section 9.03(viii), it being understood
that the Cumulative Income Amount shall be reduced at the time of,
and after giving effect to, the events described in this clause (ii).
"Default" shall mean any event, act or condition which with
notice or lapse of time, or both, would constitute an Event of
Default.
"Defaulting Bank" shall mean any Bank with respect to which
a Bank Default is in effect.
"Deferred Trade Payables" shall mean promissory notes
(whether interest bearing or non-interest bearing) executed by
Holdings or any of its Subsidiaries in favor of such entity's
suppliers to finance the purchase price and delivery costs of
inventory in connection with such entity's opening or acquisition of
new stores or remodeling of existing stores.
"Developer" shall mean any Person which owns, leases or
otherwise controls or intends to acquire an interest in a Development
Site.
"Development Investment" shall mean (a) a loan by the
Borrower or a Subsidiary of the Borrower to a Developer, the proceeds
of which are to be used to finance a Development Project of such
Developer, (b) a cash contribution by the Borrower or a Subsidiary of
the Borrower to the capital of a Developer, the proceeds of which are
to be used to finance a Development Project of such Developer, or (c)
a contribution by the Borrower or a Subsidiary of the Borrower to the
capital of a Developer of an interest of the Borrower or such
Subsidiary in a Development Site. The amount of any Development
Investment shall be the amount of cash loaned or contributed to a
Developer for the purpose specified above or the fair market value of
the interest of a Development Site contributed to the capital of a
Developer, which fair market value shall be determined, without
regard to the proposed investment, at the time of such contribution
in good faith by the Borrower in each case minus the amount of cash
received by the Borrower or any of its Subsidiaries in repayment of
or in return of capital in such Development Investment.
"Development Project" shall mean a project for the
development by or at the direction of a Developer of a Development
Site, including the construction, remodeling, expansion or renovation
of a store thereon, which store is to be leased to and operated by
the Borrower or one of its Subsidiaries.
"Development Site" shall mean real property which is
identified by the Borrower or one of its Subsidiaries as the intended
location for a store or a shopping center and related improvements to
be constructed, remodeled, expanded or renovated by or at the
direction of the Developer thereof, which in each case shall include
a store intended to be leased to and operated by the Borrower or one
of its Subsidiaries.
"Dividend" shall mean, with respect to any Person, that
such Person has declared or paid a dividend or returned any equity
capital to its stockholders or partners or authorized or made any
other distribution, payment or delivery of property (other than
common stock of such Person or rights, warrants or options to
purchase common stock of such Person) or cash to its stockholders or
partners as such, or redeemed, retired, purchased or otherwise
acquired, directly or indirectly, for a consideration any shares of
any class of its capital stock or any partnership interests outstand-
ing on or after the Effective Date (or any rights, options or
warrants issued by such Person with respect to its capital stock), or
set aside any funds for any of the foregoing purposes, or shall have
permitted any of its Subsidiaries to purchase or otherwise acquire
for a consideration any shares of any class of the capital stock or
any partnership interests of such Person outstanding on or after the
Effective Date (or any rights, options or warrants issued by such
Person with respect to its capital stock).
"Documents" shall mean the Credit Documents, the Senior
Subordinated Note Tender Offer Documents, the Senior Subordinated
Note Consent Solicitation Documents and the SL Documents.
"Dollars" and the sign "$" shall each mean freely
transferable lawful money of the United States.
"Drawing" shall have the meaning provided in Section
2.05(b).
"Duff & Xxxxxx" shall mean Duff & Xxxxxx Credit Rating Co.
"Effective Date" shall have the meaning provided in Section
13.10.
"Eligible Transferee" shall mean and include a commercial
bank, financial institution, any fund that invests in bank loans or
any other "accredited investor" (as defined in Regulation D of the
Securities Act).
"End Date" shall mean, for any Margin Reduction Period, the
last day of such Margin Reduction Period.
"Environmental Claims" shall mean any and all adminis-
trative, regulatory or judicial actions, suits, demands, demand
letters, directives, claims, liens, notices of noncompliance or
violation, investigations or proceedings relating in any way to any
Environmental Law or any permit issued, or any approval given, under
any such Environmental Law (hereafter, "Claims"), including, without
limitation, (a) any and all Claims by governmental or regulatory
authorities for enforcement, cleanup, removal, response, remedial or
other actions or damages pursuant to any applicable Environmental
Law, and (b) any and all Claims by any third party seeking damages,
contribution, indemnification, cost recovery, compensation or
injunctive relief in connection with alleged injury or threat of
injury to health, safety or the environment due to the presence of
Hazardous Materials.
"Environmental Law" shall mean any Federal, state, foreign
or local statute, law, rule, regulation, ordinance, code, guideline,
written policy and rule of common law now or hereafter in effect and
in each case as amended, and any judicial or administrative inter-
pretation thereof, including any judicial or administrative order,
consent decree or judgment, relating to the environment, employee
health and safety or Hazardous Materials, including, without
limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33
U.S.C. S 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C.
S 2601 et seq.; the Clean Air Act, 42 U.S.C. S 7401 et seq.; the Safe
Drinking Water Act, 42 U.S.C. S 3803 et seq.; the Oil Pollution Act
of 1990, 33 U.S.C. S 2701 et seq.; the Emergency Planning and the
Community Right-to-Know Act of 1986, 42 U.S.C. S 11001 et seq.; the
Hazardous Material Transportation Act, 49 U.S.C. S 1801 et seq. and
the Occupational Safety and Health Act, 29 U.S.C. S 651 et seq.; and
any state and local or foreign counterparts or equivalents, in each
case as amended from time to time.
"ERISA" shall mean the Employee Retirement Income Security
Act of 1974, as amended from time to time, and the regulations
promulgated and rulings issued thereunder. Section references to
ERISA are to ERISA, as in effect at the date of this Agreement and
any subsequent provisions of ERISA, amendatory thereof, supplemental
thereto or substituted therefor.
"ERISA Affiliate" shall mean each person (as defined in
Section 3(9) of ERISA) which together with Holdings or a Subsidiary
of Holdings would be deemed to be a "single employer" (i) within the
meaning of Section 414(b), (c), (m) or (o) of the Code or (ii) as a
result of Holdings or a Subsidiary of Holdings being or having been a
general partner of such person.
"Eurodollar Loan" shall mean each Revolving Loan designated
as such by the Borrower at the time of the incurrence thereof or
conversion thereto.
"Eurodollar Rate" shall mean, for any Interest Period for
any Eurodollar Loan, (a) the offered quotation to first-class banks
in the New York interbank Eurodollar market by BTCo for Dollar
deposits of amounts in immediately available funds comparable to the
outstanding principal amount of the Eurodollar Loan of BTCo with
maturities comparable to the Interest Period applicable to such
Eurodollar Loan commencing two Business Days thereafter as of 11:00
A.M. (New York time) on the date which is two Business Days prior to
the commencement of such Interest Period, divided (and rounded upward
to the nearest 1/16 of 1%) by (b) a percentage equal to 100% minus
the then stated maximum rate of all reserve requirements (including,
without limitation, any marginal, emergency, supplemental, special or
other reserves required by applicable law) applicable to any member
bank of the Federal Reserve System in respect of Eurocurrency funding
or liabilities as defined in Regulation D (or any successor category
of liabilities under Regulation D).
"Event of Default" shall have the meaning provided in
Section 10.
"Excluded Properties" shall mean, as of any date, so long
as no Default or Event of Default then exists, any interest in any
Real Property (excluding any fee interest in Real Property on which
the Collateral Agent shall have been granted a Lien in accordance
with the terms hereof and excluding any Replacement Properties)
acquired or constructed by the Borrower or any of its Subsidiaries
after the Effective Date for an aggregate purchase price not
exceeding $20,000,000 for any such Real Property.
"Existing Credit Agreement" shall mean the Credit
Agreement, dated as of November 1, 1996, among Holdings, the
Borrower, the lenders party thereto, BTCo, as administrative agent,
Chase, as syndication agent, and BTCo and Chase, as arrangers, as
such Credit Agreement is in effect on the Effective Date.
"Existing Indebtedness" shall have the meaning provided in
Section 7.21.
"Existing Letters of Credit" shall have the meaning
provided in Section 2.01(a).
"Facing Fee" shall have the meaning provided in Section
3.01(c).
"Federal Funds Rate" shall mean, for any period, a
fluctuating interest rate equal for each day during such period to
the weighted average of the rates on overnight Federal Funds
transactions with members of the Federal Reserve System arranged by
Federal Funds brokers, as published for such day (or, if such day is
not a Business Day, for the next preceding Business Day) by the
Federal Reserve Bank of New York, or, if such rate is not so pub-
lished for any day which is a Business Day, the average of the quota-
tions for such day on such transactions received by the
Administrative Agent from three Federal Funds brokers of recognized
standing selected by the Administrative Agent.
"Fees" shall mean all amounts payable pursuant to or
referred to in Section 3.01.
"Final Maturity Date" shall mean April 28, 2004.
"Fixed Charge Coverage Ratio" shall mean, for any period,
the ratio of (x) the sum of Consolidated EBITDA plus Consolidated
Rental Payments for such period to (y) Consolidated Fixed Charges for
such period.
"Guaranteed Creditors" shall mean and include each of the
Administrative Agent, the Syndication Agent, the Collateral Agent,
each Co-Arranger, each Issuing Bank, the Banks and each party (other
than any Credit Party) party to an Interest Rate Protection Agreement
or Other Hedging Agreement to the extent such party constitutes a
Secured Creditor under the Security Documents.
"Guaranteed Obligations" shall mean (i) the full and prompt
payment when due (whether at the stated maturity, by acceleration or
otherwise) of the principal and interest on each Note issued by, and
Loans made to, the Borrower under this Agreement and all
reimbursement obligations and Unpaid Drawings with respect to Letters
of Credit, together with all the other obligations (including
obligations which, but for the automatic stay under Section 362(a) of
the Bankruptcy Code, would become due) and liabilities (including,
without limitation, indemnities, fees and interest thereon) of the
Borrower to the Banks, the Administrative Agent, the Syndication
Agent, each Co-Arranger, each Issuing Bank and the Collateral Agent
now existing or hereafter incurred under, arising out of or in con-
nection with this Agreement or any other Credit Document and the due
performance and compliance by the Borrower with all the terms, con-
ditions and agreements contained in the Credit Documents and (ii) the
full and prompt payment when due (whether at the stated maturity, by
acceleration or otherwise) of all obligations (including obligations
which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due) of the Borrower owing under any
Interest Rate Protection Agreement or Other Hedging Agreement entered
into by the Borrower with any Bank or any affiliate thereof (even if
such Bank subsequently ceases to be a Bank under this Agreement for
any reason) so long as such Bank or affiliate participates in such
Interest Rate Protection Agreement or Other Hedging Agreement, and
their subsequent assigns, if any, whether now in existence or
hereafter arising, and the due performance and compliance with all
terms, conditions and agreements contained therein.
"Guarantor" shall mean Holdings, each Subsidiary Guarantor
and the XX Xxxxxx.
"Guaranty" shall mean and include the Holdings Guaranty,
the Subsidiaries Guaranty and the XX Xxxxxx Guaranty.
"Hazardous Materials" shall mean (a) any petroleum or
petroleum products, radioactive materials, asbestos in any form that
is friable, urea formaldehyde foam insulation, transformers or other
equipment that contain dielectric fluid containing levels of poly-
chlorinated biphenyls, and radon gas; (b) any chemicals, materials or
substances defined as or included in the definition of "hazardous
substances," "hazardous waste," "hazardous materials," "extremely
hazardous substances," "restricted hazardous waste," "toxic sub-
stances," "toxic pollutants," "contaminants," or "pollutants," or
words of similar import, under any applicable Environmental Law; and
(c) any other chemical, material or substance, the Release of which
is prohibited, limited or regulated by any governmental authority.
"Holdings" shall have the meaning provided in the first
paragraph of this Agreement.
"Holdings Common Stock" shall mean the common stock of
Holdings, par value $0.01 per share and the Class B common stock of
Holdings, par value $0.01 per share.
"Holdings Guaranty" shall mean the guaranty of Holdings
pursuant to Section 14.
"Holdings Pledge Agreement" shall have the meaning provided
in Section 5.11.
"Holdings Preferred Stock" shall mean the preferred stock
of Holdings, par value $0.01 per share.
"Holdings Security Agreement" shall have the meaning
provided in Section 5.12.
"Holdings Tax Sharing Agreement" shall mean that certain
Tax Sharing Agreement, dated as of March 22, 1995, among Holdings and
certain of its Subsidiaries as in effect on the Effective Date and as
the same may be amended or modified from time to time in accordance
with the terms thereof and hereof.
"Immaterial Subsidiary" shall mean any Subsidiary of the
Borrower that does not have assets with a fair market value of
$5,000,000 or more or has not had revenues of $5,000,000 or more for
the Test Period then most recently ended.
"Indebtedness" shall mean, as to any Person, without
duplication, (i) all indebtedness (including principal, interest,
fees and charges) of such Person for borrowed money or for the
deferred purchase price of property or services, (ii) the maximum
amount available to be drawn under all letters of credit issued for
the account of such Person and all unpaid drawings in respect of such
letters of credit, (iii) all Indebtedness of the types described in
clause (i), (ii), (iv), (v), (vi), (vii) or (viii) of this definition
secured by any Lien on any property owned by such Person, whether or
not such Indebtedness has been assumed by such Person (provided,
that, if the Person has not assumed or otherwise become liable in
respect of such Indebtedness, such Indebtedness shall be deemed to be
in an amount equal to the fair market value of the property to which
such Lien relates as determined in good faith by such Person), (iv)
the aggregate amount required to be capitalized under leases under
which such Person is the lessee, (v) all obligations of such Person
to pay a specified purchase price for goods or services, whether or
not delivered or accepted, i.e., take-or-pay and similar obligations,
(vi) all Contingent Obligations of such Person and (vii) all
obligations under any Interest Rate Protection Agreement, any Other
Hedging Agreement or under any similar type of agreement. Notwith-
standing the foregoing, Indebtedness shall not include trade payables
(other than Deferred Trade Payables) and accrued expenses incurred by
any Person in accordance with customary practices and in the ordinary
course of business of such Person.
"Intercompany Loan" shall mean any loan or advance between
or among Holdings and its Subsidiaries.
"Intercompany Note" shall mean a promissory note, in the
form of Exhibit P or such other form as may be reasonably acceptable
to the Administrative Agent, in either case evidencing Intercompany
Loans.
"Intercreditor Agreement" shall have the meaning provided
in Section 5.18.
"Interest Determination Date" shall mean, with respect to
any Eurodollar Loan, the second Business Day prior to the
commencement of any Interest Period relating to such Eurodollar Loan.
"Interest Period" shall have the meaning provided in
Section 1.09.
"Interest Rate Protection Agreement" shall mean any
interest rate swap agreement, interest rate cap agreement, interest
collar agreement, interest rate hedging agreement or other similar
agreement or arrangement.
"Investments" shall have the meaning provided in Section
9.05.
"Issuing Bank" shall mean BTCo, Chase and any other Bank
which at the request of the Borrower and with the consent of the
Administrative Agent (which consent shall not be unreasonably
withheld or delayed) agrees, in such Bank's sole discretion, to
become an Issuing Bank for the purpose of issuing Letters of Credit
pursuant to Section 2.
"Land Trust" shall mean each land trust of which one or
more Credit Parties are the sole beneficiaries and which land trust
is party to a Credit Document.
"Land Trustee" shall mean the trustee of any Land Trust.
"L/C Supportable Obligations" shall mean (i) obligations of
the Borrower or any of its Subsidiaries with respect to workers
compensation, surety bonds and other similar statutory obligations,
(ii) obligations of the Borrower or any of its Subsidiaries with
respect to industrial revenue or development bonds or financings,
(iii) obligations of the Borrower or any of its Subsidiaries with
respect to leases, (iv) performance, payment, deposit or surety
obligations of the Borrower or any of its Subsidiaries in accordance
with custom and practice in the industry and (v) such other obliga-
tions of the Borrower or any of its Subsidiaries as are reasonably
acceptable to the respective Issuing Bank and otherwise permitted to
exist pursuant to the terms of this Agreement.
"Leaseholds" of any Person shall mean all the right, title
and interest of such Person as lessee or licensee in, to and under
leases or licenses of land, improvements and/or fixtures.
"Lessee" shall have the meaning provided in Section 8.13.
"Letter of Credit" shall have the meaning provided in
Section 2.01(a).
"Letter of Credit Fee" shall have the meaning provided in
Section 3.01(b).
"Letter of Credit Outstandings" shall mean, at any time,
the sum of (i) the aggregate Stated Amount of all outstanding Letters
of Credit at such time and (ii) the amount of all Unpaid Drawings at
such time.
"Letter of Credit Request" shall have the meaning provided
in Section 2.03(a).
"Leverage Ratio" shall mean, at any time, the ratio of (x)
Consolidated Indebtedness at such time to (y) Consolidated EBITDA for
the Test Period then most recently ended.
"Lien" shall mean any mortgage, pledge, hypothecation,
assignment, deposit arrangement, encumbrance, lien (statutory or
other), preference, priority or other security agreement of any kind
or nature whatsoever (including, without limitation, any conditional
sale or other title retention agreement, any financing or similar
statement or notice filed under the UCC or any other similar
recording or notice statute, and any lease having substantially the
same effect as any of the foregoing).
"Loan" shall mean each Revolving Loan and each Swingline
Loan.
"Management Agreements" shall have the meaning provided in
Section 5.05.
"Mandatory Borrowing" shall have the meaning provided in
Section 1.01(c).
"Margin Reduction Period" shall mean each period which
shall commence on a date on which the financial statements are
delivered pursuant to Section 8.01(a) or (b), as the case may be, and
which shall end on the earlier of (i) the date of actual delivery of
the next financial statements pursuant to Section 8.01(a) or (b), as
the case may be, and (ii) the latest date on which the next financial
statements are required to be delivered to Section 8.01(a) or (b), as
the case may be.
"Margin Stock" shall have the meaning provided in
Regulation U.
"Maximum Swingline Amount" shall mean $50,000,000.
"Minimum Borrowing Amount" shall mean (i) for Revolving
Loans that are maintained as Eurodollar Loans, $5,000,000, (ii) for
Revolving Loans that are maintained as Base Rate Loans, $2,000,000
(or $1,000,000 to the extent that such Base Rate Loans are made
pursuant to Section 2.05(a)) and (iii) for Swingline Loans, $250,000.
"Moody's" shall mean Xxxxx'x Investors Service, Inc.
"Mortgage" shall mean each mortgage, deed to secure debt or
deed of trust pursuant to which any Credit Party shall have granted
to the Collateral Agent a mortgage lien on such Credit Party's
Mortgaged Property.
"Mortgage Policies" shall have the meaning provided in
Section 5.16.
"Mortgaged Property" shall mean each parcel of Real
Property owned or leased by any Credit Party which is encumbered by a
Mortgage.
"NAIC" shall mean the National Association of Insurance
Commissioners.
"Net Debt Proceeds" shall mean, with respect to any
incurrence of Indebtedness for borrowed money, the cash proceeds (net
of underwriting discounts and commissions and other costs associated
therewith) received by the respective Person from the respective
incurrence of such Indebtedness for borrowed money.
"Net Insurance Proceeds" shall mean, with respect to any
Recovery Event, the cash proceeds (net of costs and taxes incurred in
connection with such Recovery Event) received by the respective
Person in connection with the respective Recovery Event.
"Net Reversion Amount" shall mean, for any return to
Holdings or any of its Subsidiaries of any surplus assets of any
Pension Plan of Holdings or any of its Subsidiaries, the cash
proceeds of such return, net of costs incurred in connection with
obtaining such return and the incremental taxes paid or payable as a
result thereof.
"Net Sale Proceeds" shall mean, for any Asset Sale, the
gross cash proceeds (including any cash received by way of deferred
payment pursuant to a promissory note, receivable or otherwise, but
only as and when received) received from such Asset Sale, net of the
reasonable costs of such sale (including fees and commissions,
payments of unassumed liabilities relating to the assets sold and
required payments of any Indebtedness (other than Indebtedness
secured pursuant to the Security Documents) which is secured by the
respective assets which were sold), and the incremental taxes
(including income taxes) paid or payable as a result of such Asset
Sale.
"Non-Defaulting Bank" shall mean and include each Bank
other than a Defaulting Bank.
"Note" shall mean each Revolving Note and the Swingline
Note.
"Notice of Borrowing" shall have the meaning provided in
Section 1.03(a).
"Notice of Conversion" shall have the meaning provided in
Section 1.06.
"Notice Office" shall mean the office of the Administrative
Agent located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxx XxXxxxx or such other office as the Administrative
Agent may hereafter designate in writing as such to the other parties
hereto.
"Obligations" shall mean all amounts owing to the
Administrative Agent, the Syndication Agent, the Collateral Agent,
any Co-Arranger, any Issuing Bank or any Bank pursuant to the terms
of this Agreement or any other Credit Document.
"Operating Lease" shall mean, with respect to any Person,
any lease (including, without limitation, leases that may be
terminated by the lessee at any time) of any property (whether real,
personal or mixed) that is not a Capital Lease, other than any such
lease under which such Person is the lessor.
"Other Hedging Agreement" shall mean any foreign exchange
contracts, currency swap agreements, commodity agreements or other
similar agreements or arrangements designed to protect against the
fluctuations in currency values.
"Participant" shall have the meaning provided in Section
2.04(a).
"Payment Office" shall mean the office of the
Administrative Agent located at 000 Xxxxxxx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000, or such other office as the Administrative Agent may
hereafter designate in writing as such to the other parties hereto.
"PBGC" shall mean the Pension Benefit Guaranty Corporation
established pursuant to Section 4002 of ERISA, or any successor
thereto.
"Pension Plan" shall mean any Plan (including, for this
purpose, any "employee benefit plan" as defined in Section 3(3) of
ERISA), other than a multiemployer plan (as defined in Section
4001(a)(3) of ERISA), which is subject to Section 412 of the Code or
Section 302 of ERISA.
"Permitted Encumbrance" shall mean, with respect to (i) any
fee-owned Mortgaged Property, such exceptions to title as are set
forth in the Mortgage Policy delivered with respect thereto, all of
which exceptions must be reasonably acceptable to the Agents in their
reasonable discretion and (ii) any Leasehold Mortgaged Property, such
exceptions to title as were disclosed by any search of title
previously provided to and approved by the Administrative Agent.
"Permitted Holders" shall mean (i) Yucaipa or any entity
controlled thereby or any of the partners thereof, (ii) Apollo
Advisors, L.P. or any entity controlled thereby or (iii) any of the
Permitted Transferees of any Person described in preceding clauses
(i) and (ii);
"Permitted Liens" shall have the meaning provided in
Section 9.01.
"Permitted Sale-Leaseback Transaction" shall mean any sale
by the Borrower or any of its Subsidiaries of a grocery store
(including equipment therein acquired after November 1, 1996) open or
acquired after November 1, 1996, and grocery store equipment,
warehouse equipment, distribution equipment and office equipment, in
each case acquired after November 1, 1996, in connection with the
concurrent lease-back of such assets so long as (i) no Default or
Event of Default then exists or would result therefrom, (ii) each
such sale and leaseback transaction is in an arm's-length transaction
and the Borrower or the respective Subsidiary receives at least fair
market value (as determined in good faith by the Borrower or such
Subsidiary, as the case may be) (iii) the total consideration
received by the Borrower or such Subsidiary in connection with each
such sale and leaseback transaction is cash and is paid at the time
of the closing thereof, and (iv) the Net Sale Proceeds therefrom are
applied and/or reinvested as (and to the extent) required by Section
3.03(b) and the definition of Asset Sale.
"Permitted Transferees" shall mean, with respect to any
Person, (i) any Affiliate of such Person, (ii) the heirs, executors,
administrators, testamentary trustees, legatees or beneficiaries of
any such Person or (iii) a trust, the beneficiaries of which, or a
corporation or partnership, the stockholders or general or limited
partners of which, include only such Person or his or her spouse or
lineal descendants, in each case to whom such Person has transferred
the beneficial ownership of any capital stock of Holdings.
"Person" shall mean any individual, partnership, joint
venture, firm, corporation, association, limited liability company,
trust or other enterprise or any government or political subdivision
or any agency, department or instrumentality thereof.
"Plan" shall mean any pension plan as defined in Section
3(2) of ERISA, which is maintained or contributed to by (or to which
there is an obligation to contribute of) Holdings or a Subsidiary of
Holdings or an ERISA Affiliate, and each such plan for the five year
period immediately following the latest date on which Holdings or a
Subsidiary of Holdings or an ERISA Affiliate maintained, contributed
to or had an obligation to contribute to such plan.
"Pledge Agreements" shall mean and include the Holdings
Pledge Agreement, the Borrower Pledge Agreement and each of the
Subsidiary Pledge Agreements.
"Pledged Collateral" shall mean all of the respective
"Pledged Collateral" as defined in each Pledge Agreement.
"Prime Lending Rate" shall mean the rate which BTCo
announces from time to time as its prime lending rate, the Prime
Lending Rate to change when and as such prime lending rate changes.
The Prime Lending Rate is a reference rate and does not necessarily
represent the lowest or best rate actually charged to any customer.
BTCo may make commercial loans or other loans at rates of interest
at, above or below the Prime Lending Rate.
"Projections" shall mean the projections attached hereto as
Schedule VII which were prepared by Holdings for the period ending on
the last day of Holdings fiscal year 2003.
"Qualified Holdings Preferred Stock" shall mean any
preferred stock of Holdings so long as the terms of any such
preferred stock (i) do not contain any mandatory put, redemption,
repayment, sinking fund or other similar provision occurring before
December 31, 2004, (ii) do not require the cash payment of dividends,
(iii) do not contain any covenants, (iv) do not grant the holders
thereof any voting rights except for (x) voting rights required to be
granted to such holders under applicable law and (y) limited
customary voting rights on fundamental matters such as mergers,
consolidations, sales of all or substantially all of the assets of
Holdings, or liquidations involving Holdings, and (v) are otherwise
reasonably satisfactory to the Agents.
"Quarterly Payment Date" shall mean each February 28, May
31, August 31 and November 30.
"Rating Agencies" shall mean S&P, Moody's and Xxxx &
Xxxxxx.
"RCRA" shall mean the Resource Conservation and Recovery
Act, as the same may be amended from time to time, 42 U.S.C. S 6901
et seq.
"Real Property" of any Person shall mean all the right,
title and interest of such Person in and to land, buildings,
improvements and fixtures, including Leaseholds.
"Recovery Event" shall mean the receipt by Holdings or any
of its Subsidiaries of any cash insurance proceeds or condemnation
awards payable (i) by reason of theft, loss, physical destruction,
damage, taking or any other similar event with respect to any
property or assets of Holdings or any of its Subsidiaries and (ii)
under any policy of insurance required to be maintained under Section
8.03.
"Register" shall have the meaning provided in Section
13.15.
"Regulation D" shall mean Regulation D of the Board of
Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof establishing
reserve requirements.
"Regulation G" shall mean Regulation G of the Board of
Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Regulation T" shall mean Regulation T of the Board of
Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Regulation U" shall mean Regulation U of the Board of
Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Regulation X" shall mean Regulation X of the Board of
Governors of the Federal Reserve System as from time to time in
effect and any successor to all or a portion thereof.
"Release" shall mean the disposing, discharging, injecting,
spilling, pumping, leaking, leaching, dumping, emitting, escaping,
emptying, pouring or migrating, into or upon any land or water or
air, or otherwise entering into the environment.
"Replaced Bank" shall have the meaning provided in
Section 1.13.
"Replaced Property" shall have the meaning provided in
Section 8.14.
"Replacement Bank" shall have the meaning provided in
Section 1.13.
"Replacement Property" shall mean any Real Property which
is designated by the Borrower as a "Replacement Property" in
accordance with Section 8.13.
"Reportable Event" shall mean an event described in Section
4043(c) of ERISA with respect to a Plan that is subject to Title IV
of ERISA other than those events as to which the 30-day notice period
is waived under subsection .22, .23, .25, .27 or .28 of PBGC
Regulation Section 4043.
"Required Banks" shall mean Non-Defaulting Banks the sum of
whose Revolving Loan Commitments (or after the termination thereof,
outstanding Revolving Loans and RL Percentages of outstanding
Swingline Loans and Letter of Credit Outstandings) represent an
amount greater than 50% of the sum of the Total Revolving Loan
Commitment less the Revolving Loan Commitments of all Defaulting
Banks (or after the termination thereof, the sum of the then total
outstanding Revolving Loans of Non-Defaulting Banks and the aggregate
RL Percentages of Non-Defaulting Banks of the total outstanding
Swingline Loans and Letter of Credit Outstandings at such time).
"Revolving Loan" shall have the meaning provided in Section
1.01(a).
"Revolving Loan Commitment" shall mean, for each Bank, the
amount set forth opposite such Bank's name in Schedule I directly
below the column entitled "Revolving Loan Commitment," as same may be
(x) reduced from time to time pursuant to Sections 3.02, 3.03 and/or
10 or (y) adjusted from time to time as a result of assignments to or
from such Bank pursuant to Section 1.13 or 13.04(b).
"Revolving Note" shall have the meaning provided in Section
1.05(a).
"RL Percentage" of any Bank at any time shall mean a
fraction (expressed as a percentage) the numerator of which is the
Revolving Loan Commitment of such Bank at such time and the
denominator of which is the Total Revolving Loan Commitment at such
time, provided that if the RL Percentage of any Bank is to be
determined after the Total Revolving Loan Commitment has been
terminated, then the RL Percentages of the Banks shall be determined
immediately prior (and without giving effect) to such termination.
"SEC" shall have the meaning provided in Section 8.01(g).
"Section 4.04(b)(ii) Certificate" shall have the meaning
provided in Section 4.04(b)(ii).
"Secured Creditors" shall have the meaning assigned that
term in the respective Security Documents.
"Securities Act" shall mean the Securities Act of 1933, as
amended, and the rules and regulations promulgated thereunder.
"Securities Exchange Act" shall mean the Securities
Exchange Act of 1934, as amended, and the rules and regulations
promulgated thereunder.
"Security Agreements" shall mean and include the Holdings
Security Agreement, the Borrower Security Agreement and the
Subsidiary Security Agreement.
"Security Agreement Collateral" shall mean all of the
respective "Collateral" as defined in each Security Agreement.
"Security Documents" shall mean each Security Agreement,
each Trademark Security Agreement, each Pledge Agreement, each
Mortgage, the Intercreditor Agreement, any XX Xxxxxx Collateral
Documents delivered by the XX Xxxxxx to the Collateral Agent and/or
the SL Agent in order to grant to the Banks Liens in real, personal
or mixed property of the XX Xxxxxx as security for the Guaranteed
Obligations (as such term is defined in the XX Xxxxxx Guaranty).
"Senior Subordinated Notes" shall mean the Borrower's 10-
7/8% Senior Subordinated Notes due 2005 issued pursuant to the Senior
Subordinated Note Indenture.
"Senior Subordinated Note Consent" shall mean each written
consent permitting the Borrower to enter into the Senior Subordinated
Note Indenture Supplement from a holder of one or more Senior
Subordinated Notes outstanding on the record date for determining
those holders entitled to consent to such Senior Subordinated Note
Indenture Supplement.
"Senior Subordinated Note Consent Solicitation" shall mean
the solicitation of Senior Subordinated Note Consents to amend the
Senior Subordinated Note Indenture performed by or on behalf of the
Borrower simultaneously with the Senior Subordinated Note Tender
Offer.
"Senior Subordinated Note Consent Solicitation Documents"
shall mean each of the documents distributed to holders of the Senior
Subordinated Notes or otherwise entered into by the Borrower or any
of such holders in connection with the consummation of the Senior
Subordinated Note Consent Solicitation, including, without
limitation, the Senior Subordinated Note Consents and the Senior
Subordinated Note Indenture Supplement.
"Senior Subordinated Note Documents" shall mean and include
each of the documents and other agreements (including, without
limitation, the Senior Subordinated Note Indenture and the Senior
Subordinated Note Indenture Supplement) governing or evidencing the
Senior Subordinated Notes, as in effect on the Effective Date and as
the same may be amended, modified or supplemented from time to time
pursuant to the terms hereof and thereof.
"Senior Subordinated Note Indenture" shall mean the
Indenture, dated as of May 4, 1995, among the Borrower, the
subsidiary guarantors party thereto and the Senior Subordinated Note
Indenture Trustee, as in effect on the Effective Date.
"Senior Subordinated Note Indenture Supplement" shall mean
the Supplemental Indenture to the Senior Subordinated Note Indenture
entered into by the Borrower, the subsidiary guarantors party thereto
and the Senior Subordinated Note Indenture Trustee in connection with
the Senior Subordinated Note Consent Solicitation.
"Senior Subordinated Note Indenture Trustee" shall mean the
United States Trust Company of New York.
"Senior Subordinated Note Tender Offer" shall mean the
offer by the Borrower to purchase for cash any and all of the Senior
Subordinated Notes, the foregoing to be effected pursuant to the
Senior Subordinated Note Tender Offer Documents.
"Senior Subordinated Note Tender Offer Documents" shall
mean the offer to purchase distributed by the Borrower in connection
with the Senior Subordinated Note Tender Offer, and all amendments
and exhibits thereto, and all documents related to any of the
foregoing filed with the SEC or distributed to the holders (or
representatives) of the Senior Subordinated Notes in connection with
the Senior Subordinated Note Tender Offer.
"Shareholders' Agreements" shall have the meaning provided
in Section 5.05.
"SL Agent" shall mean The Chase Manhattan Bank, in its
capacity as agent for the lenders under the SL Credit Agreement and
the other SL Documents.
"SL Collateral Documents" shall mean and include those SL
Documents which are security agreements, pledge agreements,
mortgages, deeds of trust, assignment agreements and documents and
other collateral documents (including, without limitation, the XX
Xxxxxx Collateral Documents) delivered by the XX Xxxxxx or any Credit
Party to the SL Lenders, the SL Agent, the XX Xxxxxx, the Collateral
Agent or any Bank in order to grant to the SL Lenders, the Banks
and/or the other Secured Creditors Liens in any property of the XX
Xxxxxx or any Credit Party.
"SL Credit Agreement" shall mean that certain Credit
Agreement, dated as of August 19, 1997, among the XX Xxxxxx, the SL
Lenders and the SL Agent.
"SL Documents" shall mean and include the SL Participation
Agreement and each of the other Operative Agreements (as such term is
defined in Annex A to the SL Participation Agreement) as in effect on
the Effective Date and as the same may be amended, modified or
supplemented from time to time pursuant to the terms hereof and
thereof.
"SL Guaranty" shall mean that certain Guaranty, dated as of
August 19, 1997, made by Holdings, the Borrower and the other
guarantors signatories thereto in favor of the SL Agent for the SL
Lenders as in effect on the Effective Date and as the same may be
amended, modified or supplemented from time to time pursuant to the
terms hereof and thereof.
"SL Lenders" shall mean the several banks and other
financial institutions from time to time party to the SL Credit
Agreement.
"XX Xxxxxx" shall mean The Dominick's Realty Trust 1997, a
Delaware business trust.
"XX Xxxxxx Collateral Documents" shall mean and include
those SL Collateral Documents from time to time entered into by the
XX Xxxxxx or in any way relating to collateral granted by the XX
Xxxxxx including, without limitation, (i) mortgages, deeds of trust
or security agreements, as applicable, on the SL Properties and
personal properties relating thereto, (ii) an assignment of the
Agency Agreement and the Construction Contract (as each such term is
defined in Annex A to the SL Participation Agreement) and (iii) an
assignment of the Lease or any Lease Supplement (as each such term is
defined in Annex A to the SL Participation Agreement).
"XX Xxxxxx Guaranty" shall have the meaning provided in
Section 5.17.
"SL Participation Agreement" shall mean that certain
Participation Agreement, dated as of August 19, 1997, among the
Borrower, the XX Xxxxxx, Wilmington Trust Company, the SL Agent, the
SL Lenders and the investors in the XX Xxxxxx as in effect on the
Effective Date and as the same may be amended, modified or
supplemented from time to time pursuant to the terms hereof and
thereof.
"SL Properties" shall have the meaning given to the term
"Properties" in Annex A to the SL Participation Agreement.
"Start Date" shall mean, with respect to any Margin
Reduction Period, the first day of such Margin Reduction Period.
"Stated Amount" of each Letter of Credit shall mean, at any
time, the maximum amount available to be drawn thereunder (in each
case determined without regard to whether any conditions to drawing
could then be met).
"Store Land Property" shall mean any Real Property in
Illinois, Indiana or Wisconsin acquired after the Effective Date by
the Borrower or any Subsidiary of the Borrower in the form of
undeveloped land or land with improvements thereon existing as of the
date of acquisition (i) which is identified in good faith by the
chief financial officer of the Borrower and evidenced by a
certificate of such officer of the Borrower at the time of
acquisition thereof as the intended location for a grocery store or
other facility to be constructed for and owned and operated by the
Borrower or one of its Subsidiaries within five years of the
effective date of acquisition thereof and (ii) with respect to which
the Borrower gives notice to the Administrative Agent in accordance
with Section 8.01(e)(iii); provided that any such Store Land Property
shall no longer be a "Store Land Property" (a) on the date of sale by
the Borrower or any of its Subsidiaries (other than to any Credit
Party or any other Affiliate) of any Store Land Property consisting
of undeveloped land or land with improvements thereon existing as of
the date of acquisition or (b) if the Borrower or any of its
Subsidiaries constructs a grocery store or other facility thereon,
then on the date (which date shall be the first date after the
completion of the grocery store or other facility on which the
Borrower is required to deliver to the Administrative Agent and the
Banks financial statements pursuant to Section 8.01) that the
Borrower gives a written notice to the Administrative Agent
indicating that the Borrower shall on and after such date include the
aggregate purchase price incurred in connection with the acquisition
of such Store Land Property as "Capital Expenditures" pursuant to the
definition thereof (it being understood that such aggregate purchase
price shall be deemed to be Capital Expenditures incurred during the
fiscal year in which such notice is given). A Store Land Property
shall continue to be a "Store Land Property" hereunder whether or not
such Real Property continues to be undeveloped land or land with
improvements thereon existing as of the date of acquisition and
whether or not such Real Property continues to be owned by a Credit
Party and such Store Land Property shall no longer be a "Store Land
Property" only if the conditions set forth in clause (a) or clause
(b) in the immediately preceding sentence are satisfied. The
purchase price with respect to any Store Land Property shall be the
amount paid (whether paid in cash or other consideration) for such
Store Land Property.
"Subsidiaries Guaranty" shall have the meaning provided in
Section 5.15.
"Subsidiary" shall mean, as to any Person, (i) any
corporation more than 50% of whose stock of any class or classes
having by the terms thereof ordinary voting power to elect a majority
of the directors of such corporation (irrespective of whether or not
at the time stock of any class or classes of such corporation shall
have or might have voting power by reason of the happening of any
contingency) is at the time owned by such Person and/or one or more
Subsidiaries of such Person and (ii) any partnership, limited
liability company, association, joint venture or other entity in
which such Person and/or one or more Subsidiaries of such Person has
more than a 50% equity interest at the time. Notwithstanding the
foregoing (and except for purposes of the definition of Unrestricted
Subsidiary contained herein), an Unrestricted Subsidiary shall be
deemed not to be a Subsidiary of Holdings or any of its other
Subsidiaries for purposes of this Agreement.
"Subsidiary Guarantor" shall mean (i) each Subsidiary of
the Borrower on the Effective Date (other than BDI and BPI so long as
such Persons constitute Immaterial Subsidiaries) and (ii) each
Subsidiary of the Borrower created or acquired after the Effective
Date (other than an Immaterial Subsidiary). At such time as an
Immaterial Subsidiary (including BDI and BPI) ceases to constitute an
Immaterial Subsidiary, such Person shall promptly take all of the
action required to be taken pursuant to Section 8.12 and from and
after such time such Person shall constitute a Subsidiary Guarantor.
"Subsidiary Pledge Agreement" shall have the meaning
provided in Section 5.11.
"Subsidiary Security Agreement" shall have the meaning
provided in Section 5.12.
"Subsidiary Trademark Security Agreement" shall have the
meaning provided in Section 5.13.
"Subsidiaries Guaranty" shall have the meaning provided in
Section 5.15.
"Swingline Bank" shall mean BTCo.
"Swingline Expiry Date" shall mean that date which is five
Business Days prior to the Final Maturity Date.
"Swingline Loan" shall have the meaning provided in Section
1.01(b).
"Swingline Note" shall have the meaning provided in Section
1.05(a).
"S&P" shall mean Standard & Poor's Ratings Group.
"Syndication Agent" shall mean Chase.
"Tax Sharing Agreements" shall have the meaning provided in
Section 5.05.
"Taxes" shall have the meaning provided in Section 4.04(a).
"Test Date" shall mean, with respect to any Start Date, the
last day of the most recent fiscal quarter of the Borrower ended
immediately prior to such Start Date.
"Test Period" shall mean the four consecutive fiscal
quarters of the Borrower then last ended (in each case taken as one
accounting period).
"Title Insurance Policies" shall mean ALTA loan title
insurance policies issued by a title insurance company reasonably
satisfactory to the Agents in the amounts reasonably satisfactory to
the Agents with respect to any particular Real Property subject to a
Mortgage, assuring the Agents that the applicable Mortgage creates a
valid and enforceable first priority lien on the respective Real
Property subject to such Mortgage, free and clear of all defects and
encumbrances, except Permitted Liens, which Title Insurance Policies
shall otherwise be in form and substance reasonably satisfactory to
the Agents and shall include endorsements for any matters that any
Agent may reasonably request and for future advances under this
Agreement, the Notes and the other Credit Documents, and shall
provide for affirmative insurance and such reinsurance as any Agent
may reasonably request, all of the foregoing in form and substance
reasonably satisfactory to the Agents.
"Total Revolving Loan Commitment" shall mean, at any time,
the sum of the Revolving Loan Commitments of each of the Banks.
"Total Unutilized Revolving Loan Commitment" shall mean, at
any time, an amount equal to the remainder of (x) the Total Revolving
Loan Commitment then in effect less (y) the sum of the aggregate
principal amount of all Revolving Loans and Swingline Loans then out-
standing plus the then aggregate amount of all Letter of Credit
Outstandings.
"Trademark Security Agreements" shall mean and include the
Borrower Trademark Security Agreement and the Subsidiary Trademark
Security Agreement.
"Trademark Collateral" shall mean all of the respective
"Collateral" as defined in each Trademark Security Agreement.
"Transaction" shall mean, collectively, (i) the Bank
Refinancing, (ii) the Senior Subordinated Note Tender Offer, (iii)
the Senior Subordinated Note Consent Solicitation, (iv) the entering
into of one or more amendments to the SL Documents and (v) the
occurrence of the Effective Date and the incurrence of Loans on the
Effective Date.
"Type" shall mean the type of Loan determined with regard
to the interest option applicable thereto, i.e., whether a Base Rate
Loan or a Eurodollar Loan.
"UCC" shall mean the Uniform Commercial Code as from time
to time in effect in the relevant jurisdiction.
"Unfunded Current Liability" of any Plan shall mean the
amount, if any, by which the actuarial present value of the
accumulated plan benefits under the Plan as of the close of its most
recent plan year, determined in accordance with actuarial assumptions
at such time consistent with Statement of Financial Accounting
Standards No. 87, exceeds the market value of the assets allocable
thereto.
"United States" and "U.S." shall each mean the United
States of America.
"Unpaid Drawing" shall have the meaning provided for in
Section 2.05(a).
"Unrestricted Subsidiary" shall mean any Subsidiary of the
Borrower that is acquired or created after the Effective Date and is
designated by the Borrower at the time of the acquisition or creation
thereof as an Unrestricted Subsidiary hereunder by written notice to
the Agents and shall include any Subsidiary of such Unrestricted
Subsidiary; provided that the Borrower shall only be permitted to
designate a Subsidiary as an Unrestricted Subsidiary so long as (i)
no Default or Event of Default then exists or would result therefrom,
(ii) such Unrestricted Subsidiary shall be capitalized (to the extent
capitalized by Holdings or any of its Subsidiaries) through cash
Investments as permitted by, and in compliance with, Section
9.05(xvii), (iii) such Unrestricted Subsidiary does not (and shall
not) own any capital stock of or other equity interests in, or have
any Lien on any property of, Holdings or any Subsidiary of Holdings
other than a Subsidiary of the Unrestricted Subsidiary, (iv) any
Indebtedness or other obligations of such Unrestricted Subsidiary is
(and remains) non-recourse to Holdings or any of its other
Subsidiaries and (v) the Borrower delivers a certificate of its
president, chief financial officer or treasurer to the Agents
certifying compliance with preceding clauses (i) through (iv).
Notwithstanding the foregoing, the Borrower may designate any
Unrestricted Subsidiary of the Borrower to be a Subsidiary of the
Borrower if, but only if, (x) no Default or Event of Default then
exists or would result therefrom, and with any Indebtedness, Liens,
Investments and/or Capital Expenditures incurred, assumed, created,
issued and/or made by such Unrestricted Subsidiary being deemed to
have been so incurred, assumed, created, issued and/or made at the
time of such designation, (y) based on calculations made by the
Borrower on a pro forma basis after giving effect to such
designation, no Default or Event of Default will exist under, or
would have existed during the Test Period last reported (or required
to be reported pursuant to Section 8.01(a) or (b), as the case may
be) prior to the date of the respective designation, pursuant to the
financial covenants contained in Sections 9.08, 9.09 and 9.10,
inclusive and (z) a written notice of such designation is given to
the Agents at the time thereof, which written notice shall be
accompanied by a certificate of the president, the chief financial
officer or the treasurer of the Borrower certifying (and showing the
calculations therefor in reasonable detail) as to the compliance with
the preceding clauses (x) and (y).
"Unutilized Revolving Loan Commitment" shall mean, with
respect to any Bank at any time, such Bank's Revolving Loan
Commitment at such time less the sum of (i) the aggregate outstanding
principal amount of all Revolving Loans made by such Bank at such
time and (ii) such Bank's RL Percentage of the Letter of Credit
Outstandings at such time.
"Wholly-Owned Subsidiary" shall mean, as to any Person, (i)
any corporation 100% of whose capital stock (other than director's
qualifying shares) is at the time owned by such Person and/or one or
more Wholly-Owned Subsidiaries of such Person and (ii) any
partnership, limited liability company, association, joint venture or
other entity in which such Person and/or one or more Wholly-Owned
Subsidiaries of such Person has a 100% equity interest at such time.
"Yucaipa" shall mean The Yucaipa Companies, a California
general partnership, or any successor thereto (i) which is an
Affiliate of Xxxxxx X. Xxxxxx, (ii) which has been established for
the sole purpose of changing the form of The Yucaipa Companies from
that of a partnership to that of a limited liability company or such
other form acceptable to the Agents in their sole discretion and
(iii) the form and structure of which has been approved by the Agents
in their sole discretion.
"Yucaipa Management Agreement" shall mean the Management
Agreement, dated as of November 1, 1996, among Yucaipa, Holdings and
the Borrower, as amended or modified from time to time in accordance
with the terms thereof and hereof.
"Yucaipa Warrant" shall mean Yucaipa's warrant issued to it
on March 22, 1995 by Holdings as in effect on the Effective Date and
as the same may be amended from time to time thereafter pursuant to
the terms hereof and thereof.
SECTION 12. The Agents.
12.01 Appointment. The Banks hereby irrevocably designate
BTCo as Administrative Agent (for purposes of this Section 12, the
term "Administrative Agent" also shall include BTCo in its capacity
as a Co-Arranger and as Collateral Agent pursuant to the Security
Documents) to act as specified herein and in the other Credit
Documents. The Banks hereby irrevocably designate Chase as
Syndication Agent hereunder (for purposes of this Section 12, the
term "Syndication Agent" also shall include Chase Securities Inc. in
its capacity as a Co-Arranger) to act as specified herein and in the
other Credit Documents. Each Bank hereby irrevocably authorizes, and
each holder of any Note by the acceptance of such Note shall be
deemed irrevocably to authorize, each Agent to take such action on
their behalf under the provisions of this Agreement, the other Credit
Documents and any other instruments and agreements referred to herein
or therein and to exercise such powers and to perform such duties
hereunder and thereunder as are specifically delegated to or required
of such Agent by the terms hereof and thereof and such other powers
as are reasonably incidental thereto. Each Agent may perform any of
its duties hereunder by or through its officers, directors, agents,
employees or affiliates.
12.02 Nature of Duties. No Agent shall have any duties or
responsibilities except those expressly set forth in this Agreement
and in the other Credit Documents. Neither Agent nor any of their
respective officers, directors, agents, employees or affiliates shall
be liable for any action taken or omitted by them hereunder or under
any other Credit Document or in connection herewith or therewith,
unless caused by its or their gross negligence or willful misconduct.
The duties of each Agent shall be mechanical and administrative in
nature; neither Agent shall have by reason of this Agreement or any
other Credit Document a fiduciary relationship in respect of any Bank
or the holder of any Note; and nothing in this Agreement or any other
Credit Document, expressed or implied, is intended to or shall be so
construed as to impose upon either Agent any obligations in respect
of this Agreement or any other Credit Document except as expressly
set forth herein or therein.
12.03 Lack of Reliance on the Agents. Independently and
without reliance upon any Agent, each Bank and the holder of each
Note, to the extent it deemed or deems appropriate, has made and
shall continue to make (i) its own independent investigation of the
financial condition and affairs of Holdings and its Subsidiaries in
connection with the making and the continuance of the Loans and the
taking or not taking of any action in connection herewith and (ii)
its own appraisal of the creditworthiness of Holdings and its
Subsidiaries and, except as expressly provided in this Agreement, no
Agent shall have any duty or responsibility, either initially or on a
continuing basis, to provide any Bank or the holder of any Note with
any credit or other information with respect thereto, whether coming
into its possession before the making of the Loans or at any time or
times thereafter. Neither Agent shall be responsible to any Bank or
the holder of any Note for any recitals, statements, information,
representations or warranties herein or in any document, certificate
or other writing delivered in connection herewith or for the execu-
tion, effectiveness, genuineness, validity, enforceability,
perfection, collectability, priority or sufficiency of this Agreement
or any other Credit Document or the financial condition of Holdings
or any of its Subsidiaries or be required to make any inquiry con-
cerning either the performance or observance of any of the terms,
provisions or conditions of this Agreement or any other Credit
Document, or the financial condition of Holdings or any of its
Subsidiaries or the existence or possible existence of any Default or
Event of Default.
12.04 Certain Rights of the Agents. If any Agent shall
request instructions from the Required Banks or all of the Banks, as
applicable, with respect to any act or action (including failure to
act) in connection with this Agreement or any other Credit Document,
such Agent shall be entitled to refrain from such act or taking such
action unless and until such Agent shall have received instructions
from the Required Banks or all of the Banks, as applicable; and such
Agent shall not incur liability to any Bank by reason of so
refraining. Without limiting the foregoing, no Bank or the holder of
any Note shall have any right of action whatsoever against any Agent
as a result of such Agent acting or refraining from acting hereunder
or under any other Credit Document in accordance with the
instructions of the Required Banks or all of the Banks, as
applicable.
12.05 Reliance. Each Agent shall be entitled to rely, and
shall be fully protected in relying, upon any note, writing,
resolution, notice, statement, certificate, telex, teletype or
telecopier message, cablegram, radiogram, order or other document or
telephone message signed, sent or made by any Person that such Agent
believed to be the proper Person, and, with respect to all legal
matters pertaining to this Agreement and any other Credit Document
and its duties hereunder and thereunder, upon advice of counsel
selected by such Agent.
12.06 Indemnification. To the extent any Agent is not
reimbursed and indemnified by Holdings or any of its Subsidiaries,
the Banks will reimburse and indemnify such Agent in proportion to
their respective "percentage" as used in determining the Required
Banks (determined as if there were no Defaulting Banks) for and
against any and all liabilities, obligations, losses, damages,
penalties, claims, actions, judgments, costs, expenses or dis-
bursements of whatsoever kind or nature which may be imposed on,
asserted against or incurred by such Agent in performing its
respective duties, if any, hereunder or under any other Credit
Document or in any way relating to or arising out of this Agreement
or any other Credit Document; provided that no Bank shall be liable
to any Person indemnified hereunder for any portion of such liabil-
ities, obligations, losses, damages, penalties, actions, judgments,
suits, costs, expenses or disbursements resulting from such
indemnified Person's gross negligence or willful misconduct (as
finally determined by a court of competent jurisdiction).
12.07 The Agents in Their Individual Capacities. With
respect to its obligation to make Loans, or issue or participate in
Letters of Credit, under this Agreement, each Agent shall have the
rights and powers specified herein for a "Bank" and may exercise the
same rights and powers as though it were not performing the duties
specified herein; and the term "Banks," "Required Banks," "holders of
Notes" or any similar terms shall, unless the context clearly
otherwise indicates, include such Agent in its individual capacity.
The Agents and their respective affiliates may accept deposits from,
lend money to, and generally engage in any kind of banking,
investment banking, trust or other business with, or provide debt
financing, equity capital or other services (including financial
advisory services) to, any Credit Party or any Affiliate of any
Credit Party (or any Person engaged in a similar business with any
Credit Party or any Affiliate thereof) as if they were not performing
the duties specified herein, and may accept fees and other consider-
ation from any Credit Party or any Affiliate of any Credit Party for
services in connection with this Agreement and otherwise without
having to account for the same to the Banks.
12.08 Holders. Each Agent may deem and treat the payee of
any Note as the owner thereof for all purposes hereof unless and
until a written notice of the assignment, transfer or endorsement
thereof, as the case may be, shall have been filed with such Agent.
Any request, authority or consent of any Person who, at the time of
making such request or giving such authority or consent, is the
holder of any Note shall be conclusive and binding on any subsequent
holder, transferee, assignee or endorsee, as the case may be, of such
Note or of any Note or Notes issued in exchange therefor.
12.09 Resignation by the Agents. (a) The Administrative
Agent may resign from the performance of all its respective functions
and duties hereunder and/or under the other Credit Documents at any
time by giving 15 Business Days' prior written notice to the Banks
and, to the extent permitted by applicable law, the Borrower. Such
resignation shall take effect upon the appointment of a successor
Administrative Agent pursuant to clauses (b) and (c) below or as
otherwise provided below. The Syndication Agent may resign from the
performance of all its respective functions and duties hereunder
and/or under the other Credit Documents at any time by giving written
notice to the Administrative Agent, the Banks and, to the extent
permitted by applicable law, the Borrower, and such resignation shall
take effect upon the giving of such notice.
(b) Upon any such notice of resignation by the
Administrative Agent, the Required Banks shall appoint a successor
Administrative Agent hereunder or thereunder who shall be a
commercial bank or trust company reasonably acceptable to the
Borrower, which acceptance shall not be unreasonably withheld or
delayed.
(c) If a successor Administrative Agent shall not have
been so appointed within such 15 Business Day period, the
Administrative Agent with the consent of the Borrower (which consent
shall not be unreasonably withheld or delayed), shall then appoint a
successor Administrative Agent who shall serve as Administrative
Agent hereunder or thereunder until such time, if any, as the
Required Banks appoint a successor Administrative Agent as provided
above.
(d) If no successor Administrative Agent has been
appointed pursuant to clause (b) or (c) above by the 20th Business
Day after the date such notice of resignation was given by the
Administrative Agent, the Administrative Agent's resignation shall
become effective and the Required Banks shall thereafter perform all
the duties of the Administrative Agent hereunder and/or under any
other Credit Document until such time, if any, as the Required Banks
appoint a successor Administrative Agent as provided above.
SECTION 13. Miscellaneous.
13.01 Payment of Expenses, etc. The Borrower shall: (i)
whether or not the transactions herein contemplated are consummated,
pay all reasonable out-of-pocket costs and expenses of the Agents
(including, without limitation, the reasonable fees and disbursements
of White & Case and of the Agents' local counsel and consultants) in
connection with (x) the preparation, execution and delivery of this
Agreement and the other Credit Documents and the documents and
instruments referred to herein and therein and any amendment, waiver
or consent relating hereto or thereto and (y) their respective
syndication efforts with respect to this Agreement; (ii) after the
occurrence of an Event of Default, pay all costs and expenses,
including reasonable attorneys' fees (including internal counsel) and
costs of settlement, incurred by each of the Agents and each of the
Banks in enforcing any Obligations of or in collecting any payments
due from any Credit Party hereunder or under the other Credit
Documents by reason of such Event of Default or in connection with
any refinancing or restructuring of the credit arrangements provided
under this Agreement in the nature of a "work-out" or pursuant to any
insolvency or bankruptcy proceedings; (iii) pay and hold each of the
Banks harmless from and against any and all present and future stamp,
excise and other similar documentary taxes with respect to the
foregoing matters and save each of the Banks harmless from and
against any and all liabilities with respect to or resulting from any
delay or omission (other than to the extent attributable to such
Bank) to pay such taxes; and (iv) indemnify each Agent and each Bank,
and each of their respective officers, directors, employees, repre-
sentatives and agents from and hold each of them harmless against any
and all liabilities, obligations (including removal or remedial
actions), losses, damages, penalties, claims, actions, judgments,
suits, costs, expenses and disbursements (including reasonable
attorneys' and consultants' fees and disbursements) incurred by,
imposed on or assessed against any of them as a result of, or arising
out of, or in any way related to, or by reason of, (a) any
investigation, litigation or other proceeding (whether or not any
Agent or any Bank is a party thereto and whether or not such
investigation, litigation or other proceeding is brought by or on
behalf of any Credit Party) related to the entering into and/or
performance of this Agreement or any other Credit Document or the use
of any Letter of Credit or the proceeds of any Loans hereunder or the
consummation of the Transaction or any other transactions
contemplated herein or in any other Document or the exercise of any
of their rights or remedies provided herein or in the other
Documents, or (b) the actual or alleged presence of Hazardous
Materials in the air, surface water or groundwater or on the surface
or subsurface of any Real Property owned or at any time operated by
Holdings or any of its Subsidiaries, the generation, storage, trans-
portation, handling or disposal of Hazardous Materials by Holdings or
any of its Subsidiaries at any location, whether or not owned or
operated by Holdings or any of its Subsidiaries, the non-compliance
of any Real Property with foreign, federal, state and local laws,
regulations, and ordinances (including applicable permits thereunder)
applicable to any Real Property, or any Environmental Claim asserted
against Holdings, any of its Subsidiaries or any Real Property owned
or at any time operated by Holdings or any of its Subsidiaries,
including, in each case, without limitation, the reasonable fees and
disbursements of counsel and other consultants incurred in connection
with any such investigation, litigation or other proceeding (but
excluding any losses, liabilities, claims, damages or expenses to the
extent incurred by reason of the gross negligence, bad faith or
willful misconduct of the Person to be indemnified (as finally
determined by a court of competent jurisdiction)). To the extent
that the undertaking to indemnify, pay or hold harmless any Agent or
any Bank set forth in the preceding sentence may be unenforceable
because it is violative of any law or public policy, the Borrower
shall make the maximum contribution to the payment and satisfaction
of each of the indemnified liabilities which is permissible under
applicable law.
13.02 Right of Setoff. In addition to any rights now or
hereafter granted under applicable law or otherwise, and not by way
of limitation of any such rights, upon the occurrence and during the
continuance of an Event of Default, each Bank is hereby authorized at
any time or from time to time, without presentment, demand, protest
or other notice of any kind to any Credit Party or to any other
Person, any such notice being hereby expressly waived, to set off and
to appropriate and apply any and all deposits (general or special or
trust accounts) and any other Indebtedness at any time held or owing
by such Bank (including, without limitation, by branches and agencies
of such Bank wherever located) to or for the credit or the account of
any Credit Party against and on account of the Obligations and
liabilities of the Credit Parties to such Bank under this Agreement
or under any of the other Credit Documents, including, without
limitation, all interests in Obligations purchased by such Bank
pursuant to Section 13.06(b), and all other claims of any nature or
description arising out of or connected with this Agreement or any
other Credit Document, irrespective of whether or not such Bank shall
have made any demand hereunder and although said Obligations,
liabilities or claims, or any of them, shall be contingent or
unmatured.
13.03 Notices. Except as otherwise expressly provided
herein, all notices and other communications provided for hereunder
shall be in writing (including telegraphic, telex, telecopier or
cable communication) and mailed, telegraphed, telexed, telecopied,
cabled or delivered: if to any Credit Party, at the address
specified opposite its signature below or in the other relevant
Credit Documents; if to the Bank, at its address specified on
Schedule II; and if to the Administrative Agent, at the Notice
Office; or, as to any Credit Party or the Administrative Agent, at
such other address as shall be designated by such party in a written
notice to the other parties hereto and, as to each Bank, at such
other address as shall be designated by such Bank in a written notice
to the Borrower and the Administrative Agent. All such notices and
communications shall, when mailed, telegraphed, telexed, telecopied,
or cabled or sent by overnight courier, be effective when deposited
in the mails, delivered to the telegraph company, cable company or
overnight courier, as the case may be, or sent by telex or
telecopier, except that notices and communications to each Agent and
the Borrower shall not be effective until received by such Agent or
the Borrower, as the case may be.
13.04 Benefit of Agreement; Assignments; Participations.
(a) This Agreement shall be binding upon and inure to the benefit of
and be enforceable by the respective successors and assigns of the
parties hereto; provided, however, the Borrower may not assign or
transfer any of its rights, obligations or interest hereunder without
the prior written consent of each of the Banks and, provided further,
that, although any Bank may transfer, assign or grant participations
in its rights hereunder, such Bank shall remain a "Bank" for all
purposes hereunder (and may not transfer or assign all or any portion
of its Commitments hereunder except as provided in Sections 1.13 and
13.04(b)) and the transferee, assignee or participant, as the case
may be, shall not constitute a "Bank" hereunder and, provided
further, that no Bank shall transfer or grant any participation under
which the participant shall have rights to approve any amendment to
or waiver of this Agreement or any other Credit Document except to
the extent such amendment or waiver would (i) extend the final
scheduled maturity of any Loan, Note or Letter of Credit (unless such
Letter of Credit is not extended beyond the Final Maturity Date) in
which such participant is participating, or reduce the rate or extend
the time of payment of interest or Fees thereon (except in connection
with a waiver of applicability of any post-default increase in
interest rates) or reduce the principal amount thereof, or increase
the amount of the participant's participation over the amount thereof
then in effect (it being understood that a waiver of any Default or
Event of Default or of a mandatory reduction in the Total Revolving
Loan Commitment, shall not constitute a change in the terms of such
participation, and that an increase in any Revolving Loan Commitment
or Revolving Loan shall be permitted without the consent of any
participant if the participant's participation is not increased as a
result thereof), (ii) consent to the assignment or transfer by the
Borrower of any of its rights and obligations under this Agreement or
(iii) release all or substantially all of the Collateral under all of
the Security Documents (except as expressly provided in the Credit
Documents) supporting the Loans hereunder in which such participant
is participating. In the case of any such participation, the
participant shall not have any rights under this Agreement or any of
the other Credit Documents (the participant's rights against such
Bank in respect of such participation to be those set forth in the
agreement executed by such Bank in favor of the participant relating
thereto) and all amounts payable by the Borrower hereunder shall be
determined as if such Bank had not sold such participation.
(b) Notwithstanding the foregoing, any Bank (or any Bank
together with one or more other Banks) may (x) assign all or a
portion of its Revolving Loan Commitment and related outstanding
Obligations hereunder to (i) its parent company and/or any affiliate
of such Bank which is at least 50% owned by such Bank or its parent
company or to one or more Banks or (ii) in the case of any Bank that
is a fund that invests in bank loans, any other fund that invests in
bank loans and is managed by the same investment advisor of such Bank
or by an Affiliate of such investment advisor or (y) assign all, or
if less than all, a portion equal to at least $5,000,000 in the
aggregate for the assigning Bank or assigning Banks, of such
Revolving Loan Commitment or Revolving Loan Commitments and related
outstanding Obligations hereunder to one or more Eligible Transferees
(treating any fund that invests in bank loans and any other fund that
invests in bank loans and is managed by the same investment advisor
of such fund or by an Affiliate of such investment advisor as a
single Eligible Transferee), each of which assignees shall become a
party to this Agreement as a Bank by execution of an Assignment and
Assumption Agreement, provided that, (i) at such time Schedule I
shall be deemed modified to reflect the Revolving Loan Commitments
and/or outstanding Revolving Loans, as the case may be, of such new
Bank and of the existing Banks, (ii) upon the surrender of the
relevant Revolving Note by the assigning Bank (or, upon such
assigning Bank's indemnifying the Borrower for any lost Revolving
Note pursuant to a customary indemnification agreement) a new
Revolving Note will be issued, at the Borrower's expense, to such new
Bank and to the assigning Bank upon the request of such new Bank or
assigning Bank, such new Revolving Note to be in conformity with the
requirements of Section 1.05 (with appropriate modifications) to the
extent needed to reflect the revised Revolving Loan Commitments
and/or outstanding Revolving Loans, as the case may be, (iii) the
consent of the Administrative Agent and, so long as no Default or
Event of Default under Section 10.05 then exists, the consent of the
Borrower (each of which consents shall not be unreasonably withheld
or delayed) shall be required in connection with any assignment to an
Eligible Transferee pursuant to clause (y) above, (iv) the
Administrative Agent shall receive at the time of each such
assignment, from the assigning or assignee Bank, the payment of a
non-refundable assignment fee of $3,500 and (v) no such transfer or
assignment will be effective until recorded by the Administrative
Agent on the Register pursuant to Section 13.15. To the extent of
any assignment pursuant to this Section 13.04(b), the assigning Bank
shall be relieved of its obligations hereunder with respect to its
assigned Revolving Loan Commitment and outstanding Revolving Loans.
At the time of each assignment pursuant to this Section 13.04(b) to a
Person which is not already a Bank hereunder and which is not a
United States person (as such term is defined in Section 7701(a)(30)
of the Code) for Federal income tax purposes, the respective assignee
Bank shall, to the extent legally entitled to do so, provide to the
Borrower the appropriate Internal Revenue Service Forms (and, if
applicable, a Section 4.04(b)(ii) Certificate) described in Section
4.04(b). To the extent that an assignment of all or any portion of a
Bank's Revolving Loan Commitment and related outstanding Obligations
pursuant to Section 1.13 or this Section 13.04(b) would, at the time
of such assignment, result in increased costs under Section 1.10,
2.06 or 4.04 from those being charged by the respective assigning
Bank prior to such assignment, then the Borrower shall not be
obligated to pay such increased costs (although the Borrower, in
accordance with and pursuant to the other provisions of this
Agreement, shall be obligated to pay any other increased costs of the
type described above resulting from changes after the date of the
respective assignment).
(c) Nothing in this Agreement shall prevent or prohibit
any Bank from pledging its Revolving Loans and Revolving Note here-
under to a Federal Reserve Bank in support of borrowings made by such
Bank from such Federal Reserve Bank and, with the consent of the
Administrative Agent, any Bank which is a fund may pledge all or any
portion of its Revolving Loans and Revolving Note to its trustee in
support of its obligations to its trustee. No pledge pursuant to
this clause (c) shall release the transferor Bank from any of its
obligations hereunder.
13.05 No Waiver; Remedies Cumulative. No failure or delay
on the part of any Agent, the Collateral Agent, any Issuing Bank or
any Bank in exercising any right, power or privilege hereunder or
under any other Credit Document and no course of dealing between the
Borrower or any other Credit Party and any Agent, the Collateral
Agent, any Issuing Bank or any Bank shall operate as a waiver
thereof; nor shall any single or partial exercise of any right, power
or privilege hereunder or under any other Credit Document preclude
any other or further exercise thereof or the exercise of any other
right, power or privilege hereunder or thereunder. The rights,
powers and remedies herein or in any other Credit Document expressly
provided are cumulative and not exclusive of any rights, powers or
remedies which any Agent, the Collateral Agent, any Issuing Bank or
any Bank would otherwise have. No notice to or demand on any Credit
Party in any case shall entitle any Credit Party to any other or
further notice or demand in similar or other circumstances or consti-
tute a waiver of the rights of any Agent, the Collateral Agent, any
Issuing Bank or any Bank to any other or further action in any
circumstances without notice or demand.
13.06 Payments Pro Rata. (a) Except as otherwise
provided in this Agreement, the Administrative Agent agrees that
promptly after its receipt of each payment from or on behalf of the
Borrower in respect of any Obligations hereunder, it shall distribute
such payment to the Banks (other than any Bank that has consented in
writing to waive its pro rata share of any such payment) pro rata
based upon their respective shares, if any, of the Obligations with
respect to which such payment was received.
(b) Each of the Banks agrees that, if it should receive
any amount hereunder (whether by voluntary payment, by realization
upon security, by the exercise of the right of setoff or banker's
lien, by counterclaim or cross action, by the enforcement of any
right under the Credit Documents, or otherwise), which is applicable
to the payment of the principal of, or interest on, the Revolving
Loans, Unpaid Drawings, Commitment Commission or Letter of Credit
Fees, of a sum which with respect to the related sum or sums received
by other Banks is in a greater proportion than the total of such
Obligation then owed and due to such Bank bears to the total of such
Obligation then owed and due to all of the Banks immediately prior to
such receipt, then such Bank receiving such excess payment shall
purchase for cash without recourse or warranty from the other Banks
an interest in the Obligations of the respective Credit Party to such
Banks in such amount as shall result in a proportional participation
by all the Banks in such amount; provided that if all or any portion
of such excess amount is thereafter recovered from such Bank, such
purchase shall be rescinded and the purchase price restored to the
extent of such recovery, but without interest.
(c) Notwithstanding anything to the contrary contained
herein, the provisions of the preceding Sections 13.06(a) and (b)
shall be subject to the express provisions of this Agreement which
require, or permit, differing payments to be made to Non-Defaulting
Banks as opposed to Defaulting Banks.
13.07 Calculations; Computations; Accounting Terms.
(a) The financial statements to be furnished to the Banks pursuant
hereto shall be made and prepared in accordance with generally ac-
cepted accounting principles in the United States consistently
applied throughout the periods involved (except as set forth in the
notes thereto or as otherwise disclosed in writing by the Borrower to
the Banks); provided that, (i) except as otherwise specifically
provided herein, all computations and all definitions used in
determining compliance with Sections 9.07 through 9.10, inclusive,
shall utilize accounting principles and policies in conformity with
those used to prepare the historical financial statements of the
Borrower referred to in Section 7.05(a), and (ii) except as expressly
provided herein, the financial results of Unrestricted Subsidiaries
shall be ignored.
(b) All computations of interest, Commitment Commission
and other Fees hereunder shall be made on the basis of a year of 360
days for the actual number of days (including the first day but
excluding the last day; except that in the case of Letter of Credit
Fees, the last day shall be included) occurring in the period for
which such interest, Commitment Commission or other Fees are payable.
13.08 GOVERNING LAW; SUBMISSION TO JURISDICTION; VENUE;
WAIVER OF JURY TRIAL. (a) THIS AGREEMENT AND THE OTHER CREDIT
DOCUMENTS AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER AND
THEREUNDER SHALL, EXCEPT AS OTHERWISE PROVIDED IN THE MORTGAGES, BE
CONSTRUED IN ACCORDANCE WITH AND BE GOVERNED BY THE LAW OF THE STATE
OF NEW YORK. ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS
AGREEMENT OR ANY OTHER CREDIT DOCUMENT MAY BE BROUGHT IN THE COURTS
OF THE STATE OF NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN
DISTRICT OF NEW YORK, AND, BY EXECUTION AND DELIVERY OF THIS AGREE-
MENT OR ANY OTHER CREDIT DOCUMENT, EACH OF HOLDINGS AND THE BORROWER
HEREBY IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY,
GENERALLY AND UNCONDITIONALLY, THE NON-EXCLUSIVE JURISDICTION OF THE
AFORESAID COURTS. EACH OF HOLDINGS AND THE BORROWER HEREBY FURTHER
IRREVOCABLY WAIVES ANY CLAIM THAT ANY SUCH COURTS LACK PERSONAL
JURISDICTION OVER SUCH CREDIT PARTY, AND AGREES NOT TO PLEAD OR
CLAIM, IN ANY LEGAL ACTION PROCEEDING WITH RESPECT TO THIS AGREEMENT
OR ANY OTHER CREDIT DOCUMENTS BROUGHT IN ANY OF THE AFOREMENTIONED
COURTS, THAT SUCH COURTS LACK PERSONAL JURISDICTION OVER SUCH CREDIT
PARTY. EACH OF HOLDINGS AND THE BORROWER FURTHER IRREVOCABLY
CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES
THEREOF BY REGISTERED OR CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH
CREDIT PARTY AT ITS ADDRESS SET FORTH OPPOSITE ITS SIGNATURE BELOW,
SUCH SERVICE TO BECOME EFFECTIVE 30 DAYS AFTER SUCH MAILING. EACH OF
HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY WAIVES ANY OBJECTION TO
SUCH SERVICE OF PROCESS AND FURTHER IRREVOCABLY WAIVES AND AGREES NOT
TO PLEAD OR CLAIM IN ANY ACTION OR PROCEEDING COMMENCED HEREUNDER OR
UNDER ANY OTHER CREDIT DOCUMENT THAT SERVICE OF PROCESS WAS IN ANY
WAY INVALID OR INEFFECTIVE. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
ANY AGENT, ANY BANK OR THE HOLDER OF ANY NOTE TO SERVE PROCESS IN ANY
OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR
OTHERWISE PROCEED AGAINST HOLDINGS OR THE BORROWER IN ANY OTHER
JURISDICTION.
(b) EACH OF HOLDINGS AND THE BORROWER HEREBY IRREVOCABLY
WAIVES ANY OBJECTION WHICH IT MAY NOW OR HEREAFTER HAVE TO THE LAYING
OF VENUE OF ANY OF THE AFORESAID ACTIONS OR PROCEEDINGS ARISING OUT
OF OR IN CONNECTION WITH THIS AGREEMENT OR ANY OTHER CREDIT DOCUMENT
BROUGHT IN THE COURTS REFERRED TO IN CLAUSE (a) ABOVE AND HEREBY
FURTHER IRREVOCABLY, TO THE EXTENT PERMITTED BY APPLICABLE LAW,
WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT ANY
SUCH ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.
(c) EACH OF THE PARTIES TO THIS AGREEMENT HEREBY
IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION,
PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS
AGREEMENT, THE OTHER CREDIT DOCUMENTS OR THE TRANSACTIONS
CONTEMPLATED HEREBY OR THEREBY.
13.09 Counterparts. This Agreement may be executed in any
number of counterparts and by the different parties hereto on
separate counterparts, each of which when so executed and delivered
shall be an original, but all of which shall together constitute one
and the same instrument. A set of counterparts executed by all the
parties hereto shall be lodged with the Borrower and the
Administrative Agent.
13.10 Effectiveness. This Agreement shall become
effective on the date (the "Effective Date") on which (i) Holdings,
the Borrower, the Administrative Agent and each of the Banks shall
have signed a counterpart hereof (whether the same or different
counterparts) and shall have delivered the same to the Administrative
Agent at the Notice Office or, in the case of the Banks, shall have
given to the Administrative Agent telephonic (confirmed in writing),
written or telex notice (actually received) at such office that the
same has been signed and mailed to it and (ii) the conditions set
forth in Section 5 are met or waived to the reasonable satisfaction
of the Agents and the Required Banks. Unless the Administrative
Agent has received actual notice from any Bank that the conditions
contained in Section 5 have not been met to its satisfaction, upon
the satisfaction of the condition described in clause (i) of the
immediately preceding sentence and upon the Agents' good faith
determination that the conditions described in clause (ii) of the
immediately preceding sentence have been met or waived, then the
Effective Date shall have been deemed to have occurred, regardless of
any subsequent determination that one or more of the conditions
thereto had not been met. The Administrative Agent will give
Holdings, the Borrower and each Bank prompt written notice of the
occurrence of the Effective Date.
13.11 Headings Descriptive. The headings of the several
sections and subsections of this Agreement are inserted for
convenience only and shall not in any way affect the meaning or
construction of any provision of this Agreement.
13.12 Amendment or Waiver; etc. (a) Neither this Agree-
ment nor any other Credit Document nor any terms hereof or thereof
may be changed, waived, discharged or terminated unless such change,
waiver, discharge or termination is in writing signed by the
respective Credit Parties party thereto and the Required Banks,
provided that no such change, waiver, discharge or termination shall,
without the consent of each Bank (other than a Defaulting Bank), (i)
extend the final scheduled maturity of any Loan or Note or extend the
stated expiration date of any Letter of Credit beyond the Final
Maturity Date, or reduce the rate or extend the time of payment of
interest (other than a waiver of the applicability of any post-
default increase in interest rates) or Fees thereon, or reduce the
principal amount thereof (except to the extent repaid in cash) (it
being understood that any amendment or modification to the financial
definitions in this Agreement or to Section 13.07(a) shall not
constitute a reduction in the rate of interest or Fees for the
purposes of this clause (i)), (ii) release all or substantially all
of the Collateral under all the Security Documents (except as
expressly provided in the Credit Documents), (iii) amend, modify or
waive any provision of this Section 13.12, (iv) reduce the percentage
specified in the definition of Required Banks (it being understood
that, with the consent of the Required Banks, additional extensions
of credit pursuant to this Agreement may be included in the
determination of the Required Banks on substantially the same basis
as the Revolving Loan Commitments are included on the Effective Date)
or (v) consent to the assignment or transfer by the Borrower of any
of its rights and obligations under this Agreement; provided further,
that no such change, waiver, discharge or termination shall (v)
increase the Revolving Loan Commitment of any Bank over the amount
thereof then in effect without the consent of such Bank (it being
understood that waivers or modifications of conditions precedent,
covenants, Defaults or Events of Default or of a mandatory reduction
in the Total Revolving Loan Commitment shall not constitute an
increase of the Revolving Loan Commitment of any Bank, and that an
increase in the available portion of any Revolving Loan Commitment of
any Bank shall not constitute an increase of the Revolving Loan
Commitment of such Bank), (w) without the consent of any Issuing Bank
that has outstanding Letters of Credit, amend, modify or waive any
provision of Section 2 or alter its rights or obligations with
respect to Letters of Credit (it being understood and agreed that to
the extent any Issuing Bank does not have any Letters of Credit
outstanding but such Issuing Bank does not give its consent to any
such amendment, modification or waiver, such issuing Bank may, in its
sole discretion, resign from being an Issuing Bank hereunder upon
written notice to the Borrower and the Administrative Agent), (x)
without the consent of the Swingline Bank, alter the Swingline Bank's
rights or obligations with respect to Swingline Loans, (y) without
the consent of each Agent, amend, modify or waive any provision of
Section 12 or any other provision as same relates to the rights or
obligations of such Agent, or (z) without the consent of the
Collateral Agent, amend, modify or waive any provision relating to
the rights or obligations of the Collateral Agent.
(b) If, in connection with any proposed change, waiver,
discharge or termination to any of the provisions of this Agreement
or any other Credit Document as contemplated by clauses (i) through
(v), inclusive, of the first proviso to Section 13.12(a), the consent
of the Required Banks is obtained but the consent of one or more of
such other Banks whose consent is required is not obtained, then the
Borrower shall have the right, so long as all non-consenting Banks
whose individual consent is required are treated as described in
either clauses (A) or (B) below, to either (A) replace each such non-
consenting Bank or Banks with one or more Replacement Banks pursuant
to Section 1.13 so long as at the time of such replacement, each such
Replacement Bank consents to the proposed change, waiver, discharge
or termination or (B) terminate such non-consenting Bank's Revolving
Loan Commitment and/or repay the outstanding Revolving Loans of such
Bank and cash collateralize its applicable RL Percentage of the
Letter of Credit Outstandings in accordance with Sections 3.02(b) and
4.01(b), provided that, unless the Revolving Loan Commitment that is
terminated, and Revolving Loans repaid, pursuant to preceding clause
(B) are immediately replaced in full at such time through the addi-
tion of new Banks or the increase of the Revolving Loan Commitments
and/or outstanding Revolving Loans of existing Banks (who in each
case must specifically consent thereto), then in the case of any
action pursuant to preceding clause (B) the Required Banks
(determined after giving effect to the proposed action) shall
specifically consent thereto, provided further, that in any event the
Borrower shall not have the right to replace a Bank, terminate its
Revolving Loan Commitment or repay its Revolving Loans solely as a
result of the exercise of such Bank's rights (and the withholding of
any required consent by such Bank) pursuant to the second proviso to
Section 13.12(a).
13.13 Survival. All indemnities set forth herein
including, without limitation, in Sections 1.10, 1.11, 2.06, 4.04,
12.06 and 13.01 shall survive the execution, delivery and termination
of this Agreement and the Notes and the making and repayment of the
Obligations.
13.14 Domicile of Loans. Each Bank may transfer and carry
its Loans at, to or for the account of any office, Subsidiary or
affiliate of such Bank. Notwithstanding anything to the contrary
contained herein, to the extent that a transfer of Loans pursuant to
this Section 13.14 would, at the time of such transfer, result in
increased costs under Section 1.10, 1.11, 2.06 or 4.04 from those
being charged by the respective Bank prior to such transfer, then the
Borrower shall not be obligated to pay such increased costs (although
the Borrower shall be obligated to pay any other increased costs of
the type described above resulting from changes after the date of the
respective transfer).
13.15 Register. The Borrower hereby designates the
Administrative Agent to serve as the Borrower's agent, solely for
purposes of this Section 13.15, to maintain a register (the
"Register") on which it will record the Revolving Loan Commitments
from time to time of each of the Banks, the Revolving Loans made by
each of the Banks, the Swingline Loans made by the Swingline Bank and
each repayment in respect of the principal amount of the Loans of
each Bank. Failure to make any such recordation, or any error in
such recordation, shall not affect the Borrower's obligations in
respect of such Loans. With respect to any Bank, the transfer of the
Revolving Loan Commitment of such Bank and the rights to the
principal of, and interest on, any Revolving Loan made pursuant to
such Revolving Loan Commitment shall not be effective until such
transfer is recorded on the Register maintained by the Administrative
Agent with respect to ownership of such Revolving Loan Commitment and
Revolving Loans and prior to such recordation all amounts owing to
the transferor with respect to such Revolving Loan Commitment and
Revolving Loans shall remain owing to the transferor. The
registration of assignment or transfer of all or part of any
Revolving Loan Commitments and Revolving Loans shall be recorded by
the Administrative Agent on the Register only upon the acceptance by
the Administrative Agent of a properly executed and delivered
Assignment and Assumption Agreement pursuant to Section 13.04(b).
Coincident with the delivery of such an Assignment and Assumption
Agreement to the Administrative Agent for acceptance and registration
of assignment or transfer of all or part of a Revolving Loan, or as
soon thereafter as practicable, the assigning or transferor Bank
shall surrender the Revolving Note (if any) evidencing such Revolving
Loan, and thereupon one or more new Revolving Notes in the same
aggregate principal amount shall be issued to the assigning or
transferor Bank and/or the new Bank upon their request of same. The
Borrower agrees to indemnify the Administrative Agent from and
against any and all losses, claims, damages and liabilities of
whatsoever nature which may be imposed on, asserted against or
incurred by the Administrative Agent in performing its duties under
this Section 13.15.
13.16 Confidentiality. (a) Subject to the provisions of
clause (b) of this Section 13.16, each Bank agrees that it will use
its reasonable efforts not to disclose without the prior consent of
the Borrower (other than to its employees, auditors, advisors or
counsel or to another Bank if the Bank or such Bank's holding or
parent company in its sole discretion determines that any such party
should have access to such information, provided such Persons shall
be subject to the provisions of this Section 13.16 to the same extent
as such Bank) any information with respect to Holdings or any of its
Subsidiaries which is now or in the future furnished pursuant to this
Agreement or any other Credit Document provided that any Bank may
disclose any such information (i) as has become generally available
to the public other than by virtue of a breach of this Section
13.16(a) by the respective Bank, (ii) as may be required or appropri-
ate in any report, statement or testimony submitted to any municipal,
state or Federal regulatory body having or claiming to have jurisdic-
tion over such Bank or to the NAIC, the Federal Reserve Board or the
Federal Deposit Insurance Corporation or similar organizations
(whether in the United States or elsewhere) or their successors,
(iii) as may be required or appropriate in respect to any summons or
subpoena or in connection with any litigation, (iv) in order to
comply with any law, order, regulation or ruling applicable to such
Bank, (v) to any Agent or the Collateral Agent and (vi) to any
prospective or actual transferee or participant in connection with
any contemplated transfer or participation of any of the Revolving
Notes or Revolving Loan Commitments or any interest therein by such
Bank, provided that such prospective transferee or participant agrees
to be bound by the confidentiality provisions contained in this
Section 13.16. In connection with any disclosure by a Bank pursuant
to clause (ii) or (iii) of the immediately preceding sentence, such
Bank agrees to give the Borrower prior notice of such disclosure to
the extent such prior notice is practicable or permitted under the
circumstances.
(b) Each of Holdings and the Borrower hereby acknowledges
and agrees that each Bank may share with any of its affiliates any
information related to Holdings or any of its Subsidiaries (in-
cluding, without limitation, any nonpublic customer information
regarding the creditworthiness of Holdings and its Subsidiaries),
provided such Persons shall be subject to the provisions of this
Section 13.16 to the same extent as such Bank.
13.17 Limitation on Additional Amounts, Etc..
Notwithstanding anything to the contrary contained in Sections 1.10,
1.11, 2.06 or 4.04, unless a Bank gives notice to the Borrower that
it is obligated to pay an amount under any such Section within 180
days after the later of (x) the date the Bank incurs the respective
increased costs, Taxes, loss, expense or liability, reduction in
amounts received or receivable or reduction in return on capital or
(y) the date such Bank has actual knowledge of its incurrence of the
respective increased costs, Taxes, loss, expense or liability,
reductions in amounts received or receivable or reduction in return
on capital, then such Bank shall only be entitled to be compensated
for such amount by the Borrower pursuant to said Section 1.10. 1.11,
2.06 or 4.04, as the case may be, to the extent the costs, Taxes,
loss, expense or liability, reduction in amounts received or
receivable or reduction in return on capital are incurred or suffered
on or after the date which occurs 180 days prior to such Bank giving
notice to the Borrower that it is obligated to pay the respective
amounts pursuant to said Section 1.10. 1.11, 2.06 or 4.04, as the
case may be. This Section 13.17 shall have no applicability to any
Section of this Agreement other than said Sections 1.10, 1.11, 2.06
and 4.04.
SECTION 14. Holdings Guaranty.
14.01 Guaranty. In order to induce each Agent, the
Collateral Agent, any Issuing Bank and the Banks to enter into this
Agreement and to extend credit hereunder, and to induce the other
Guaranteed Creditors to enter into Interest Rate Protection
Agreements or Other Hedging Agreements, and in recognition of the
direct benefits to be received by Holdings from the proceeds of the
Loans, the issuance of the Letters of Credit and the entering into of
such Interest Rate Protection Agreements or Other Hedging Agreements,
Holdings hereby agrees with the Guaranteed Creditors as follows:
Holdings hereby unconditionally and irrevocably guarantees as primary
obligor and not merely as surety the full and prompt payment when
due, whether upon maturity, acceleration or otherwise, of any and all
of the Guaranteed Obligations of the Borrower to the Guaranteed
Creditors. If any or all of the Guaranteed Obligations of the
Borrower to the Guaranteed Creditors becomes due and payable
hereunder, Holdings unconditionally promises to pay such indebtedness
to the Administrative Agent and/or the other Guaranteed Creditors, or
order, on demand, together with any and all expenses which may be
incurred by the Administrative Agent or the other Guaranteed
Creditors in collecting any of the Guaranteed Obligations. If claim
is ever made upon any Guaranteed Creditor for repayment or recovery
of any amount or amounts received in payment or on account of any of
the Guaranteed Obligations and any of the aforesaid payees repays all
or part of said amount by reason of (i) any judgment, decree or order
of any court or administrative body having jurisdiction over such
payee or any of its property or (ii) any settlement or compromise of
any such claim effected by such payee with any such claimant
(including the Borrower), then and in such event Holdings agrees that
any such judgment, decree, order, settlement or compromise shall be
binding upon Holdings, notwithstanding any revocation of this
Guaranty or other instrument evidencing any liability of the
Borrower, and Holdings shall be and remain liable to the aforesaid
payees hereunder for the amount so repaid or recovered to the same
extent as if such amount had never originally been received by any
such payee.
14.02 Bankruptcy. Additionally, Holdings unconditionally
and irrevocably guarantees the payment of any and all of the
Guaranteed Obligations of the Borrower to the Guaranteed Creditors
whether or not due or payable by the Borrower upon the occurrence of
any of the events specified in Section 10.05, and unconditionally,
jointly and severally, promises to pay such indebtedness to the
Guaranteed Creditors, or order, on demand, in lawful money of the
United States.
14.03 Nature of Liability. The liability of Holdings
hereunder is exclusive and independent of any security for or other
guaranty of the Guaranteed Obligations of the Borrower whether
executed by Holdings, any other guarantor or by any other party, and
the liability of Holdings hereunder is not affected or impaired by
(a) any direction as to application of payment by the Borrower or by
any other party, or (b) any other continuing or other guaranty,
undertaking or maximum liability of a guarantor or of any other party
as to the Guaranteed Obligations of the Borrower, or (c) any payment
on or in reduction of any such other guaranty or undertaking, or (d)
any dissolution, termination or increase, decrease or change in
personnel by the Borrower, or (e) any payment made to any Guaranteed
Creditor on the Guaranteed Obligations which any such Guaranteed
Creditor repays to the Borrower pursuant to court order in any
bankruptcy, reorganization, arrangement, moratorium or other debtor
relief proceeding, and Holdings waives any right to the deferral or
modification of its obligations hereunder by reason of any such
proceeding.
14.04 Independent Obligation. The obligations of Holdings
hereunder are independent of the obligations of any other guarantor,
any other party or the Borrower, and a separate action or actions may
be brought and prosecuted against Holdings whether or not action is
brought against any other guarantor, any other party or the Borrower
and whether or not any other guarantor, any other party or the
Borrower be joined in any such action or actions. Holdings waives,
to the full extent permitted by law, the benefit of any statute of
limitations affecting its liability hereunder or the enforcement
thereof. Any payment by the Borrower or other circumstance which
operates to toll any statute of limitations as to the Borrower shall
operate to toll the statute of limitations as to Holdings.
14.05 Authorization. Holdings authorizes the Guaranteed
Creditors without notice or demand (except as shall be required by
applicable statute and cannot be waived), and without affecting or
impairing its liability hereunder, from time to time to:
(a) change the manner, place or terms of payment of,
and/or change or extend the time of payment of, renew, increase,
accelerate or alter, any of the Guaranteed Obligations
(including any increase or decrease in the rate of interest
thereon), any security therefor, or any liability incurred
directly or indirectly in respect thereof, and the Guaranty
herein made shall apply to the Guaranteed Obligations as so
changed, extended, renewed or altered;
(b) take and hold security for the payment of the
Guaranteed Obligations and sell, exchange, release, surrender,
impair, realize upon or otherwise deal with in any manner and in
any order any property by whomsoever at any time pledged or
mortgaged to secure, or howsoever securing, the Guaranteed
Obligations or any liabilities (including any of those
hereunder) incurred directly or indirectly in respect thereof or
hereof, and/or any offset thereagainst;
(c) exercise or refrain from exercising any rights against
the Borrower, any other Credit Party or others or otherwise act
or refrain from acting;
(d) release or substitute any one or more endorsers,
guarantors, the Borrower, other Credit Parties or other
obligors;
(e) settle or compromise any of the Guaranteed
Obligations, any security therefor or any liability (including
any of those hereunder) incurred directly or indirectly in re-
spect thereof or hereof, and may subordinate the payment of all
or any part thereof to the payment of any liability (whether due
or not) of the Borrower to its creditors other than the
Guaranteed Creditors;
(f) apply any sums by whomsoever paid or howsoever
realized to any liability or liabilities of the Borrower to the
Guaranteed Creditors regardless of what liability or liabilities
of Holdings or the Borrower remain unpaid;
(g) consent to or waive any breach of, or any act,
omission or default under, this Agreement, any other Credit
Document or any of the instruments or agreements referred to
herein or therein, or otherwise amend, modify or supplement this
Agreement, any other Credit Document or any of such other
instruments or agreements; and/or
(h) take any other action which would, under otherwise
applicable principles of common law, give rise to a legal or
equitable discharge of Holdings from its liabilities under this
Guaranty.
14.06 Reliance. It is not necessary for any Guaranteed
Creditor to inquire into the capacity or powers of Holdings or any of
its Subsidiaries or the officers, directors, partners or agents
acting or purporting to act on their behalf, and any Guaranteed
Obligations made or created in reliance upon the professed exercise
of such powers shall be guaranteed hereunder.
14.07 Subordination. Any indebtedness of the Borrower now
or hereafter owing to Holdings is hereby subordinated to the
Guaranteed Obligations of the Borrower owing to the Guaranteed
Creditors; and if the Administrative Agent so requests at a time when
an Event of Default exists, all such indebtedness of the Borrower to
Holdings shall be collected, enforced and received by Holdings for
the benefit of the Guaranteed Creditors and be paid over to the
Administrative Agent on behalf of the Guaranteed Creditors on account
of the Guaranteed Obligations of the Borrower to the Guaranteed
Creditors, but without affecting or impairing in any manner the
liability of Holdings under the other provisions of this Guaranty.
Prior to the transfer by Holdings of any note or negotiable instru-
ment evidencing any such indebtedness of the Borrower to Holdings,
Holdings shall xxxx such note or negotiable instrument with a legend
that the same is subject to this subordination. Without limiting the
generality of the foregoing, Holdings hereby agrees with the
Guaranteed Creditors that it will not exercise any right of
subrogation which it may at any time otherwise have as a result of
this Guaranty (whether contractual, under Section 509 of the
Bankruptcy Code or otherwise) until all Guaranteed Obligations have
been irrevocably paid in full in cash.
14.08 Waiver. (a) Holdings waives any right (except as
shall be required by applicable statute and cannot be waived) to
require any Guaranteed Creditor to (i) proceed against the Borrower,
any other guarantor or any other party, (ii) proceed against or
exhaust any security held from the Borrower, any other guarantor or
any other party or (iii) pursue any other remedy in any Guaranteed
Creditor's power whatsoever. Holdings waives any defense based on or
arising out of any defense of the Borrower, any other guarantor or
any other party, other than payment in full of the Guaranteed
Obligations, based on or arising out of the disability of the
Borrower, any other guarantor or any other party, or the validity,
legality or unenforceability of the Guaranteed Obligations or any
part thereof from any cause, or the cessation from any cause of the
liability of the Borrower other than payment in full of the
Guaranteed Obligations. The Guaranteed Creditors may, at their elec-
tion, foreclose on any security held by the Administrative Agent, the
Collateral Agent or any other Guaranteed Creditor by one or more
judicial or nonjudicial sales, whether or not every aspect of any
such sale is commercially reasonable (to the extent such sale is
permitted by applicable law), or exercise any other right or remedy
the Guaranteed Creditors may have against the Borrower or any other
party, or any security, without affecting or impairing in any way the
liability of Holdings hereunder except to the extent the Guaranteed
Obligations have been paid. Holdings waives any defense arising out
of any such election by the Guaranteed Creditors, even though such
election operates to impair or extinguish any right of reimbursement
or subrogation or other right or remedy of Holdings against the
Borrower or any other party or any security.
(b) Holdings waives all presentments, demands for
performance, protests and notices, including without limitation
notices of nonperformance, notices of protest, notices of dishonor,
notices of acceptance of this Guaranty, and notices of the existence,
creation or incurring of new or additional Guaranteed Obligations.
Holdings assumes all responsibility for being and keeping itself in-
formed of the Borrower's financial condition and assets, and of all
other circumstances bearing upon the risk of nonpayment of the
Guaranteed Obligations and the nature, scope and extent of the risks
which Holdings assumes and incurs hereunder, and agrees that the
Administrative Agent and the other Guaranteed Creditors shall have no
duty to advise Holdings of information known to them regarding such
circumstances or risks.The
14.09 Nature of Liability. It is the desire and intent of
Holdings and the Guaranteed Creditors that this Guaranty shall be
enforced against Holdings to the fullest extent permissible under the
laws and public policies applied in each jurisdiction in which
enforcement is sought. If, however, and to the extent that, the
obligations of Holdings under this Guaranty shall be adjudicated to
be invalid or unenforceable for any reason (including, without
limitation, because of any applicable state or federal law relating
to fraudulent conveyances or transfers), then the amount of Holdings
obligations under this Guaranty shall be deemed to be reduced and
Holdings shall pay the maximum amount of the Guaranteed Obligations
which would be permissible under applicable law.
* * *
IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute and deliver this Agreement as of the
date first above written.
Address:
DOMINICK'S SUPERMARKETS, INC.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopier:(000) 000-0000 By /s
Attention: Chief Financial Officer Name: Xxxxxx Xxxxxx
Title:Vice President & Treasurer
DOMINICK'S FINER FOODS, INC.
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Telecopier:(000) 000-0000 By /s
Attention: Chief Financial Officer Name: Xxxxxx Xxxxxx
Title:Vice President and Treasurer
BANKERS TRUST COMPANY,
Individually, as Co-Arranger and as
Administrative Agent
By /s
Name: Xxxx Xxx Xxxxx
Title:Managing Director
THE CHASE MANHATTAN BANK,
Individually and as Syndication Agent
By /s
Name: Xxxxx Xxxxxxx
Title:Vice President
CHASE SECURITIES INC.,
as Co-Arranger
By /s
Name: Xxxx Xxxxxxxxxx
Title:Managing Director
THE MITSUBISHI TRUST AND BANKING
CORPORATION
By /s
Name: Xxxxxxxx Xxxxxxx
Title: Senior Vice President
THE SAKURA BANK, LIMITED, CHICAGO
BRANCH
By /s
Name: Xxxxx Xxxxx
Title: Assitant General Manager
ABN AMRO BANK N.V.
By /s
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
By /s
Name: Xxxx X. Xxxx
Title: Vice President
BANQUE PARIBAS
By
Name: Xxx Xxxxxxx
Title: Managing Director
By /s
Name: Xxx Xxxxxxxxx
Title: Director
MARINE MIDLAND BANK
By /s
Name: Xxxx Xxxxxxxx
Title: Authorized Signatory
CREDIT LYONNAIS CHICAGO BRANCH
By /s
Name: Xxxxxxx Xxxxx
Title: Vice President
CAISSE NATIONALE DE CREDIT AGRICOLE
By /s
Name: Xxxx Xxxxxx
Title: Senior Vice President, Branch
Manager and Head of National Banking
Group
By /s
Name: Xxxxx Xxxxx
Title: First Vice President,
Head of Corporate Banking Chicago
THE FUJI BANK, LIMITED
By /s
Name: Xxxxx X. Xxxxxxxx
Title: Joint General Manager
THE FIRST NATIONAL BANK OF CHICAGO
By /s
Name: Xxxx Xxxxx
Title: First Vice President
BANK OF SCOTLAND
By /s
Name: Xxxxx Xxxx Tat
Title: Vice President
COMPAGNIE FINANCIERE DE CIC ET DE
L'UNION EUROPEENE
By /s
Name: Xxxxxxx Xxxx
Title: Vice President
By /s
Name: Xxxx Xxxxxxx
Title: First Vice President
THE SUMITOMO TRUST & BANKING
COMPANY, LTD., NEW YORK BRANCH
By /s
Name: Xxxxx Xxxxxx
Title: Senior Vice President
THE TOYO TRUST & BANKING CO., LTD.
By /s
Name: Xxxxxxx Xxxxxx
Title: Vice President
BANK OF MONTREAL
By /s
Name: Xxxxxx Xxxxxx
Title: Director
THE SUMITOMO BANK, LIMITED,
CHICAGO BRANCH
By /s
Name: Xxxxxxxxx Xxxxxxxxx
Title: Joint General Manager
U.S. BANK, NATIONAL ASSOCIATION
By /s
Name: Xxxxx Xxxxxx
Title: Vice President
UNION BANK OF CALIFORNIA, N.A.
By /s
Name: Xxxxxxx X. Xxxxxxx
Title: Senior Vice President
THE NORTHERN TRUST COMPANY
By /s
Name: XX Xxxxxxx
Title:Vice President
ROYAL BANK OF CANADA
By /s
Name: Xxxxxxxxx Xxxxxx
Title:Managing Director
SUMMIT BANK
By /s
Name: Xxxxx X. Xxxxxxx
Title:Vice President & Regional Manager
LASALLE NATIONAL BANK
By /s
Name: Xxxxxxx X. Xxxxxxx
Title: First Vice President
